Posts Tagged With Fraud

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Former RMBS Trader Sentenced to 2 Years in Prison, Fined $2 Million After Re-Trial

On April 26, 2017, Jesse Litvak, a former trader of residential mortgage-backed securities (RMBS), was sentenced to two years in prison followed by three years of supervised release for engaging in fraudulent RMBS trades.  Litvak was also ordered to pay a $2 million fine.  Litvak’s sentenced follows a guilty verdict on one count of securities fraud after a jury trial that concluded in January 2017.  The jury also acquitted Litvak on nine counts.  Litvak’s conviction ... Continue Reading

Attorney General Jeff Sessions Delivers Remarks at the Ethics and Compliance Initiative Annual Conference

On April 24, 2017, Attorney General Jeff Sessions spoke at the Ethics and Compliance Initiative Annual Conference.  In his remarks, Sessions stated that he wanted to “make clear” that, under his leadership, “the Department of Justice remains committed to enforcing all the laws”  including “laws regarding corporate misconduct, fraud, foreign corruption and other types of white-collar crime.”  Sessions noted that he spent his “first weeks as Attorney General” making sure that the Department “strengthens its ... Continue Reading

Acting Principal Deputy Assistant Attorney General Trevor N. McFadden of the Justice Department’s Criminal Division Speaks at ACI’s 19th Annual Conference on Foreign Corrupt Practices Act

On April 20, 2017, Acting Principal Deputy Assistant Attorney General Trevor N. McFadden spoke at the American Conference Institute (“ACI”) about the Department of Justice’s continued focus on white collar crime.  Affirming the Department’s commitment, McFadden said, “While we are boosting our focus on violent crime prosecutions, the Criminal Division is fully engaged in combating crime in all its forms, and no matter what color collar its perpetrators wear.  McFadden highlighted the work of the ... Continue Reading

Four Individuals Arrested for Multi-Million Dollar Securities Fraud and Money Laundering Schemes

On April 14, 2017, four individuals were arrested for their involvement in a stock manipulation scheme involve BioCube, Inc. and their efforts to launder approximately $2 million in illegal proceeds.  The four individuals are Chris Messalas, Boris Rubizhevky, Michael Garnick and Dimitrios Argyros.  Messalas, a former securities brokers, Rubizhevky, the former Chief Executive Officer of BioCube, and Garnick, an attorney, were charged with securities fraud conspiracy.  In particular, they are charged with defrauding potential BioCube ... Continue Reading

William T. “Billy” Walters Convicted of Insider Trading

On April 7, 2017, after a four-week trial before U.S. District Court Judge P. Kevin Castel in the Southern District of New York, William T. Walters was convicted of ten counts of conspiracy, securities fraud and wire fraud charges.  The charges related to his scheme to commit insider trading.  From 2008 through 2014, Walters received material non-public information about Dean Foods Company from Thomas C. Davis, a member of the Board of Directors of Dean ... Continue Reading

Peruvian National Pleads Guilty in Manhattan Federal Court to Commodities and Wire Fraud for Running Million-Dollar Ponzi Scheme

On April 7, 2017, Pedro Jaramillo pled guilty in the Southern District of New York to one count of commodities fraud and one count of wire fraud in connection with a scheme to defraud more than two dozen investors, mostly from Latin American countries including Peru, of more than $1.2 million dollars.  According to court documents, between January 2014 and December 2016, Jaramillo solicited investments from investors, representing that investor monies would be invested in ... Continue Reading

Owners of Drug Wholesale Companies Charged in Connection with Federal ‘Structuring’ Conspiracy

On April 6, 2017, Richard Kayseryan, Derou Biglari, Jivani Markarian and Rafik Mesropyan were charged in a 20-count indictment in connection with a federal ‘structuring’ conspiracy, in which they made millions of dollars in cash deposits designed to circumvent federal reporting requirements.  Kayseryan owns the Burbank-based drug wholesale company TriMed Medical Wholesalers, Inc.—which is charged in the indictment along with the four individual defendants—and Biglari and Markarian own the Glendale-based drug wholesale business JD Pharmaceutical ... Continue Reading

Man Pleads Guilty in Connection with $5 Million Investment Fraud Scheme

On April 4, 2017, James Trolice, the president and chief marketing owner of eAgency, a California-based company that developed mobile security products, pled guilty to wire fraud and transacting in criminal proceeds in connection with a scheme to defraud investors out of more than $5 million.  Trolice was also the president and owner of Trolice Consulting Services LLC.  Along with Lee Vaccaro, Trolice sold investors interests in Trolice Consulting Services and companies that Vaccaro controlled, ... Continue Reading

Former Deputy Executive Director of Port Authority and Former Deputy Chief of Staff in New Jersey Governor’s Office Sentenced to Prison Terms

On March 29, 2017, William E. Baroni Jr., former deputy executive director of the Port Authority of New York and New Jersey, and Bridget Anne Kelly, former deputy chief of staff to New Jersey Governor Chris Christie, were sentenced to 24 months’ and 18 months’ imprisonment, respectively, in connection with their roles in a scheme to misuse Port Authority resources to create traffic problems in Fort Lee, New Jersey.  Baroni and Kelly had previously been ... Continue Reading

Turkish Banker Arrested for Conspiring to Violate U.S. Sanctions against Iran

On March 27, 2017, Mehmet Hakan Atilla, a citizen and resident of Turkey, was arrested for conspiring to use the U.S. financial system to conduct transactions on behalf of the Government of Iran and other Iranian entities and to defraud U.S. financial institutions by concealing the nature of these transactions.  According to the Complaint unsealed on March 28, Atilla, a Deputy General Manager of International Banking at a Turkish Bank, helped Reza Zarrab, a gold ... Continue Reading

Investment Advisor and Broker Convicted at Trial in Connection with Securities Fraud Scheme

On March 23, 2017, Christopher Cervino, a registered broker, and Sheik F. Khan, an investment advisor, were convicted after a three-week jury trial in connection with a securities fraud scheme involving VGTel, Inc., a publicly traded over-the-counter company.  According to the indictment, other court filings, and the evidence at trial, the defendants—led by co-conspirator Edward Durante, who pled guilty in August 2016 in connection with this matter—artificially inflated the market for VGTel, which increased their ... Continue Reading

Philadelphia District Attorney Charged with Bribery and Extortion

On March 21, 2017, Philadelphia District Attorney Rufus Seth Williams was charged in a 23-count indictment with bribery, extortion and honest services wire fraud in connection with receiving bribes from two business owners and with defrauding a nursing home and family friends of money intended for a family member’s nursing home care.  According to the indictment, from July 2010 to July 2015, Williams solicited and received tens of thousands of dollars’ worth of bribes from ... Continue Reading

Man Indicted for Theft of Over $100 Million in Fraudulent Email Scheme Against Multinational Internet Companies

On March 21, 2017, criminal charges were announced against Evaldas Rimasauskas of Lithuania in connection with a fraudulent business email compromise scheme that induced two U.S.-based internet companies—a multinational technology company and a multinational online social media company (the “Victim Companies”)—to wire over $100 million to bank accounts that he controlled.  Rimasauskas was arrested by authorities in Lithuania.  According to the indictment, from at least 2013 through 2015, Rimasauskas orchestrated a scheme in which he ... Continue Reading

Former Chief Executive Officer and Chief Financial Officer of China Medical Technologies Indicted in Connection with Securities Fraud Scheme

On March 20, 2017, an indictment charging Xiaodong Wu, the founder, CEO and Board Chairman of China Medical Technologies, Inc. (China Medical), and Tak Yung Samson Tsang, the CFO and a member of the Board of Directors of China Medical, with securities fraud and conspiracy to commit securities fraud and wire fraud was unsealed in the Eastern District of New York.  According to the indictment, Wu and Tsang allegedly defrauded China Medical’s noteholders and investors ... Continue Reading

Former Chairman and CEO of Credit Union and Operator of Unlawful Bitcoin Exchange Convicted at Trial in Connection with Bribery and Fraud Scheme

On March 17, 2017, Trevon Gross, the former Chairman and CEO of HOPE FCU, a federal credit union in New Jersey with primarily low-income members, and Yuri Lebedev, a former employee of Coin.mx, an unlawful internet-based Bitcoin exchange, were found guilty after a four-week jury trial, in connection with a bribery scheme to gain control of HOPE FCU and a fraud scheme to evade detection of Coin.mx.  Between 2013 and July 2015, Lebedev and his ... Continue Reading

Chicago Trader Indicted on Fraud Charges for Allegedly Misappropriating at Least $1.5 Million in Client Funds

On March 16, 2017, Randall Rye, the owner of Faster Than Light Trading LLC, was indicted on six counts of wire fraud in connection with a scheme to misappropriate investors’ funds for personal use.  According to the indictment, Rye told investors that he would invest their money in options and futures contracts using an algorithm.  Instead, Rye allegedly misappropriated the money for his own personal use, including vacations to St. Lucia and Bali, tickets to ... Continue Reading

U.S. Charges Russian FSB Officers and Their Criminal Conspirators for Hacking Yahoo and Millions of Email Accounts

On March 15, 2017, four defendants, including two officers of the Russian Federal Security Service (FSB), were indicted in the Northern District of California for computer fraud, economic espionage, and other criminal offenses in connection with a conspiracy to access Yahoo’s network and the contents of Yahoo webmail accounts.  The defendants are Russian nationals Dmitry Aleksandrovich Dokuchaev, Igor Anatolyevich Sushchin and Alexsey Alexseyevich Belan, and Canadian national Karim Baratov.  According to the indictment, Dokuchaev and ... Continue Reading

Former Investment Advisor Sentenced to Six Months’ Imprisonment for Insider Trading

On March 15, 2017, former investment advisor David Hobson was sentenced to six months in prison for participating in a scheme to commit insider trading in connection with deals involving the pharmaceutical company (the “Pharma Company”) at which Michael Maciocio, Hobson’s co-conspirator, worked.  Hobson had pled guilty in this case to one count of conspiracy to commit securities fraud and one count of securities fraud in October 2016.  According to the indictment and statements made ... Continue Reading

Former Global Law Firm Partner Convicted of Insider Trading

On March 15, 2017, a federal jury in the Eastern District of New York returned a guilty verdict against Robert Schulman, a former partner of a Richmond-based global law firm, for securities fraud and conspiracy to commit securities fraud.  According to the indictment, Schulman tipped off the executive of an investment advisory firm about a pending merger between Pfizer, Inc. and King Pharmaceuticals, Inc., which he had learned of through his representation of King Pharmaceuticals.  ... Continue Reading

Former Executive Director of the Ramapo Local Development Corporation Pleads Guilty in Connection with Scheme to Defraud Investors in Municipal Bonds

On March 7, 2017, Aaron Troodler, the former Executive Director of the Ramapo Local Development Corporation (“RLDC”), pled guilty to conspiring with Ramapo Town Supervisor Christopher St. Lawrence to commit securities fraud in connection with a scheme to defraud investors in municipal bonds issued by the RLDC and the Town of Ramapo. According to the charging documents, Troodler and St. Lawrence lied to investors in the municipal bonds in order to cover up the Town ... Continue Reading

Man Sentenced to 78 Months in Prison for Fraudulent Investment Companies and Obstructing SEC Investigation

On March 3, 2017, Stanley Jonathan Fortenberry was sentenced in the Northern District of Texas to 78 months in prison, as well as $890,310 in restitution and $311,254 in forfeiture, for running two investment fraud schemes and obstructing an SEC investigation.  The schemes, which ran for more than four years and defrauded investors out of approximately $900,000, raised funds for social media projects and an oil and gas drilling project but misled investors about the ... Continue Reading

Former Arkansas State Senator and Two Others Charged with Bribery and Fraud Scheme

On March 2, 2017, three individuals were charged with a fraud scheme involving bribes paid to two public officials in exchange for directing approximately $600,000 in government funds to two non-profit entities.  The individuals charged were Jonathan E. Woods, a former Arkansas state senator who served from 2013 to 2017, Oren Paris III, a college president, and Randell G. Shelton Jr., a consultant.  Each of the individuals was charged with nine counts of honest services ... Continue Reading

Founder of Suburban Tech Company Sentenced to Nine Years for Defrauding Investors out of More than $9 Million

On March 2, 2017, Gregory Webb, the founder and CEO of InfrAegis Inc. was sentenced to nine years in prison following his conviction on nine counts of mail and wire fraud for fraudulently raising more than $9 million from more than 200 investors.  Webb falsely portrayed InfrAegis as a successful science and technology company on the verge of signing billion-dollar contracts with government agencies around the world, including the city of Chicago.  Webb represented that ... Continue Reading

Former Registered Broker Pleads Guilty to Securities Fraud Conspiracy for Participating in a $131 Million Market Manipulation Scheme

On March 1, 2017, Christopher F. Castaldo, a former registered broker, pled guilty in the Eastern District of New York to conspiracy to commit securities fraud in connection with the fraudulent market manipulation of ForceField Energy Inc. (ForceField) stock, listed on the NASDAQ under the symbol “FNRG.”  According to court filings, between January 2009 and April 2015, Castaldo, together with co-conspirators, engaged in a scheme to defraud ForceField investors by (1) artificially controlling the price ... Continue Reading

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