Posts Tagged With Fraud

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Scott Tucker Sentenced to 200 Months in Prison for Operating Fraudulent Internet Payday Lender

On January 5, 2018, Acting Deputy U.S. Attorney for the Southern District of New York Joan Loughnane announced that Scott Tucker had been sentenced to 200 months in prison for his role in a fraudulent internet payday lending operation.  Tucker, along with attorney Timothy Muir, had been convicted on October 13, 2017, following a five-week trial, of fourteen counts of racketeering, wire fraud, money laundering, and Truth-In-Lending Act offenses.  Muir was sentenced to 84 months
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Turkish Banker Convicted of Conspiring to Evade U.S. Sanctions against Iran and Other Offenses

On January 3, 2018, Mehmet Hakan Atilla, a citizen and resident of Turkey, was found guilty of conspiring with others 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.  After a four-week trial before U.S. District Judge Richard M. Berman, a federal jury convicted Atilla on five of six charges in
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Former Executive Managing Director of Och-Ziff Capital Management Indicted for Defrauding Charitable Foundation and Obstruction of Justice

On January 3, 2018, a ten-count indictment against Michael Leslie Cohen was unsealed in the Eastern District of New York.  Michael Leslie Cohen, a former executive managing director of New York-based hedge fund Och-Ziff Capital Management Group LLC (“Och-Ziff”), was indicted for his alleged participation in a scheme to defraud an Och-Ziff client, a large charitable foundation, by recommending financial investments relating to the African mining sector.  Cohen was charged with one count of conspiracy
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Former Partner at New York Law Firm Convicted of Conspiring with Martin Shkreli to Commit Securities, Wire Fraud

On December 27, 2017, Bridget M. Rohde, Acting U.S. Attorney for the Eastern District of New York, announced that Evan Greebel had been convicted of one count of conspiracy to commit securities fraud and one count of conspiracy to commit wire fraud, following an 11-week trial before U.S. District Judge Kiyo A. Matsumoto.  At one time a partner at Katten Muchin Rosenman LLP, Greebel served as outside counsel to biopharmaceutical company Retrophin Inc.  In this
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Former Chairman and CEO of Technology Start-Up Company Kit Digital and Associate Found Guilty of Securities Fraud Related Offenses

On December 26, 2017, after a six-week trial presided over by U.S. District Judge Paul G. Gardephe of the Southern District of New York, a federal jury found Kaleil Tuzman, former chairman and CEO of technology start-up company KIT digital (“KITD”), and Omar Amanat guilty of various securities fraud-related offenses in connection with three separate fraudulent schemes.  First, between in or about February 2009 and in or about June 2012, Amanat, along with Stephen Maiden,
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High-Ranking Soccer Officials Convicted in Multimillion-Dollar Bribery Schemes

On December 22, 2017, after a six-week trial before U.S. District Judge Pamela K. Chen of the Eastern District of New York, a federal jury convicted Juan Angel Napout and Jose Maria Marin, former high-ranking soccer officials, of racketeering conspiracy and related offenses.  As proved at trial, the defendants and their co-conspirators accepted or agreed to accept tens of millions of dollars in bribe payments in exchange for media and marketing rights to various soccer
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Former CFO of Florida Financial Services Company Indicted for Accounting, Securities Fraud

On December 20, 2017, John P. Cronan, Acting Assistant Attorney General of the Justice Department’s Criminal Division; Benjamin Greenberg, Acting U.S. Attorney for the Southern District of Florida; and Regina Faulkerson, Inspector in Charge of the U.S. Postal Inspection Service’s Criminal Investigations Group, announced the unsealing of an indictment charging the former CFO of Bankrate Inc. with participating in a securities and accounting fraud scheme.  The indictment, filed in the Southern District of Florida, charged
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Former New York Investment Broker Admits Accepting Hundreds of Thousands of Dollars in Bribes in Exchange for Stock

On December 19, 2017, a former broker of two New York-based investment banking firms pled guilty to one count of violating the Travel Act for accepting between $550,000 and $1.5 million in cash kickbacks in exchange for arranging more favorable allocations from initial and secondary stock offerings.  According to a criminal information filed in the U.S. District Court for the District of New Jersey, New York resident Brian M. Hirsch accepted numerous kickbacks from three
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Former CEO and Former Chief Loan Officer of Failed Sonoma Valley Bank Convicted After Trial of Bank Fraud and Other Crimes

On December 18, 2017, three individuals, including the former CEO and former Chief Loan Officer of defunct Sonoma Valley Bank (“SVB” or the “Bank”) were convicted by a federal jury of multiple criminal charges that stemmed from a series of schemes carried out between 2004 and the Bank’s collapse in August 2010.  Former SVB CEO Sean Clark Cutting and former CLO Brian Scott Melland were convicted following an eight-week trial in U.S. District Court for
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Former CEO of Mobile Aggregation Company Convicted in Consumer Fraud Auto-Subscription Scheme

On December 15, 2017, Joon H. Kim, then-Acting U.S. Attorney for the Southern District of New York, announced that Darcy Wedd had been convicted of two counts of conspiracy to commit wire fraud, two counts of wire fraud, two counts of conspiracy to commit money laundering, and two counts of aggravated identity theft.  Wedd, the former CEO of mobile aggregation company Mobile Messenger, had engaged in a scheme to defraud consumers of more than $100
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Former Comptroller of Mortgage Lender Charged with Bank Fraud and Wire Fraud

On December 14, 2017, John Reimer, the vice president and comptroller of a mortgage lending institution, was charged with bank fraud and wire fraud for his alleged participation in a scheme to defraud several financial institutions.  Then-Acting U.S. Attorney Joon H. Kim announced the unsealing of Reimer’s indictment and said that Reimer allegedly “defrauded several other financial institutions of more than $12 million, falsified documents, kept funding for mortgages that never closed, and even acquired
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Chicago Investment Manager Charged with Eight Counts of Wire Fraud

On December 12, 2017, John R. Lausch, Jr., the U.S. Attorney for the Northern District of Illinois, announced the unsealing of an indictment charging Shawn Baldwin with eight counts of wire fraud.  Baldwin, an investment manager based in Chicago, is alleged to have made false statements regarding his financial connections and professional qualifications to potential investors.  Baldwin allegedly told investors that their money would be invested in various stocks and funds, but actually used investors’
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Volkswagen Senior Manager Sentenced to 84 Months in Prison for Role in Conspiracy to Cheat U.S. Emissions Tests

On December 6, 2017, Oliver Schmidt, former general manager of Volkswagen AG’s (“VW”) U.S. Environment and Engineering Office, was sentenced to 84 months in federal prison in connection with the so-called “Dieselgate” scandal involving the use of software designed to cheat U.S. emissions tests.  German national Schmidt previously pled guilty to one count of conspiracy to defraud the United States, to commit wire fraud, and to violate the Clean Air Act, as well as one
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Two Men Plead Guilty to Conspiracy to Defraud Investors in Publicly Traded Fuel Cell Company

On December 1, 2017, Joon H. Kim, then-Acting U.S. Attorney for the Southern District of New York, announced that George Doumanis and Emanuel Pantelakis had each pled guilty to one count of conspiracy to commit securities fraud in connection with a scheme to defraud investors in Terminus Energy Inc., a publicly traded penny stock.  From 2008 to 2014, Doumanis and Pantelakis made misstatements to investors regarding Terminus, including that Terminus had developed a fuel cell
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Former New York Law Firm Partner Pleads Guilty to Conspiring to Defraud Two New York Law Firms

On November 20, 2017, Keila Ravelo, a former law firm partner, pled guilty to conspiring to defraud two New York law firms.  Ravelo pled guilty to an indictment charging her with one count of conspiracy to commit wire fraud and one count of tax evasion.  From 2008 through July 2014, Ravelo and her husband, Melvin Feliz, conspired to defraud two law firms by forming two limited liability companies which purported to provide litigation support to
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Chicago Investment Adviser Charged with Fraud for Allegedly Stealing More Than $5 Million from Clients

On November 15, 2017, Acting United States Attorney for the Northern District of Illinois Joel R. Levin and Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation Jeffrey S. Sallet announced the filing of an information charging Daniel Glick with one count of wire fraud.  Glick, who owned three accounting and financial services firms, was charged with lying to clients and forging checks and other documents in order to misappropriate client funds
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Former Partner at International Law Firm Pleads Guilty to Insider Trading

On November 10, 2017, Walter C. Little, a former partner at an international law firm, pled guilty to conspiracy to commit securities fraud.  Between February 2015 and May 2016, Little used his position at the firm to access material nonpublic information relating to a client’s anticipated delisting from the NASDAQ exchange, clients’ involvement in M&A transactions, clients’ anticipated earnings announcements, and a planned securities offering.  With this information, Little made securities trades and shared that
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Former Chief Financial Officer of American Realty Capital Partners Sentenced for Accounting Fraud

On November 8, 2017, Brian Block, the former Chief Financial Officer of American Realty Capital Partners (“ARCP”), was sentenced to 18 months in prison for inflating a key metric used to evaluate the financial performance of publicly traded REITs in ARCP’s filings with the SEC.  Block was convicted by a jury in June, following a three-week trial before U.S. District Judge J. Paul Oetken.  According to the indictment and evidence presented at trial, Block and
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Day Trader Indicted in Computer Hacking and Securities Fraud Scheme Targeting Online Brokerage Accounts

On November 8, 2017, a federal grand jury in Brooklyn returned a four-count indictment charging Pennsylvania resident Joseph P. Willner with conspiracy to commit wire fraud, conspiracy to commit securities fraud and computer intrusions, securities fraud, and conspiracy to commit money laundering.  According to the indictment, Willner and others conspired to hack into the online brokerage accounts of numerous victims and to place unauthorized trades in those accounts between September 2014 and May 2017.  Willner
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Hedge Fund Chairman Sentenced to 30 Months in Prison for Conspiracy to Commit Securities and Wire Fraud

On November 7, 2017, Nicholas Mitsakos was sentenced by Judge Denny Chin to 30 months in prison and two years of supervised release for conspiracy to commit securities fraud and wire fraud.  Mitsakos, who had pled guilty on May 25, 2017, was also required to forfeit over $860,000 and to pay restitution to victims.  In order to attract investors to “Matrix Capital,” a hedge fund he created in October 2013, Mitsakos sent marketing materials claiming
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Virginia Man Pleads Guilty to $100 Million Market Manipulation Scheme Involving Fitbit Stock

On November 7, 2017, Robert Walter Murray pled guilty to securities fraud in connection with a stock manipulation scheme involving a sham tender offer for outstanding Fitbit, Inc. stock.  According to the indictment and statements made in public court proceedings, Murray, claiming to be an officer of a China-based entity called ABM Capital, filed a sham tender offer to purchase all outstanding Fitbit stock at a significant premium to its then-existing market price with the
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Former CEO of Arthrocare Corporation Sentenced to 20 Years in Prison for Role in $750 Million Securities Fraud Scheme

On November 3, 2017, Michael Baker, the former CEO of publicly traded medical device company ArthroCare Corporation (“ArthroCare”), was sentenced to 240 months in prison for his role in a scheme that resulted in shareholder losses of more than $750 million.  Following a two-week retrial, Baker was convicted in August of one count of conspiracy to commit wire fraud and securities fraud, seven counts of wire fraud, two counts of securities fraud, and two counts
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Former Chief Financial Officer of Pharmaceutical Company Pleads Guilty to Making False Statements to Auditors About Improper Accounting

On November 2, 2017, Philip Jacoby, the former CFO of Osiris Therapeutics, Inc., pled guilty to one count of making false statements to auditors in connection with a review of Osiris’s 2014 10-K and third quarter 2015 10-Q filings.  In September 2013, Osiris agreed with the FDA that it would not sell one of its products, Ovation, after December 31, 2014.  An Osiris distributor wanted to continue to be able to access Ovation after that
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Brooklyn Resident Charged with Securities Fraud Conspiracy in Two Initial Offerings of Cryptocurrency

On November 1, 2017, a criminal complaint was unsealed against Maksim Zaslavskiy, charging him with securities fraud conspiracy in connection with fraudulent misstatements made to investors in two initial coin offerings.  Zaslavskiy conducted these virtual currency offerings through two of his companies, REcoin Group Foundation, LLC and DRC World, Inc. To attract investors, Zaslavskiy and his associates told them that investments in REcoin were hedged by investments in real estate and physical diamonds, but these
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