Russian National and Bitcoin Exchange Charged in 21-Count Indictment for Operating Alleged International Money Laundering Scheme and Allegedly Laundering Funds from Hack of Mt. Gox

On July 26, 2017, a grand jury in California indicted Alexander Vinnik, a Russian national, for money laundering, operating an unlicensed money service business (BTC-e), and related crimes.  One day prior to the indictment, Vinnik was arrested in Greece.  The indictment alleges that Vinnik stole identities, facilitated drug trafficking, and helped launder criminal proceeds.  Vinnik is also accused of receiving funds from the infamous hack of Mt. Gox and laundering them through online exchanges, including ... Continue Reading

Chicago Trader Sentenced for Misappropriating More than $1.7 Million in Client Funds

On July 26, 2017, Randall Rye, a twenty-six year old owner of Faster Than Light Trading LLC, was sentenced to more than five and a half years imprisonment for defrauding clients out of $1.7 million.  Rye promised substantial profits from his proprietary trading program and claimed to invest clients’ money using a computer algorithm.  Rye misappropriated the funds for his own personal use, including for travel expenses and expensive event tickets.  United States v. Rye ... Continue Reading

Former CEO of Virtual Currency Companies Pleads Guilty to $9 Million Fraud

On July 20, 2017, Homero Joshua Garza pled guilty to one count of wire fraud for a scheme in which companies he owned and operated sold fraudulent virtual currency products to consumers.  Virtual currency is a digital representation of monetary value that functions as a form of currency; a virtual currency “miner” is computer hardware that runs software which solves computer algorithms to validate groups of transactions in that virtual currency, awarding the operator of ... Continue Reading

Former Credit Suisse Banker Pleads Guilty to Conspiring with U.S. Taxpayers and Other Swiss Bankers to Defraud the United States

On July 19, 2017, Susanne D. Rüegg Meier, the former head of the Zurich Team of Credit Suisse’s North American desk in Switzerland, pled guilty to conspiring to defraud the U.S.  From 2002 to 2011, she participated in a conspiracy to aid U.S. taxpayers in evading their income taxes by concealing assets and income in Swiss accounts.  The tax loss associated with her conduct was somewhere between $3.5 and $9.5 million.  In particular, Rüegg Meier ... Continue Reading

CEO of Virginia Health Care Technology Company Sentenced to Almost Ten Years in Prison for $49 Million Shareholder Fraud and $7.5 Million Employment Tax Fraud

On July 19, 2017, Sreedhar Potarazu was sentenced to 119 months and 29 days—approximately ten years—in prison for fraud and failure to account for and pay employment taxes.  Potarazu, an ophthalmic surgeon in Maryland and Virginia, founded a Delaware corporation, which operated in McLean, Virginia and provided healthcare-related data analysis and services.  Potarazu provided materially false and misleading information to the company’s shareholders in order to induce more than $49 million in capital investments into ... Continue Reading

Acting Assistant Attorney General Kenneth A. Blanco Speaks at the Atlantic Council Inter-American Dialogue Event on Lessons from Brazil: Crisis, Corruption and Global Cooperation

On July 19, 2017, Acting Assistant Attorney General Kenneth A. Blanco spoke at the Atlantic Council Inter-American Dialogue Event.  Blanco addressed a number of topics, including transnational criminal investigations and prosecutions, U.S. and Brazilian cooperation, and the DOJ’s Kleptocracy Asset Recovery Initiative.  Blanco expressed that the DOJ is committed to working with partners, like Brazil.

With respect to transnational criminal investigations and prosecutions, Blanco highlighted the global nature of the criminal schemes the DOJ investigates ... Continue Reading

Three Former Traders for Major Banks Arraigned in Foreign Currency Exchange Antitrust Conspiracy

On July 17, 2017, three former foreign exchange traders, Richard Usher, Rohan Ramchandani and Christopher Ashton, voluntarily surrendered to the FBI and were arraigned for their alleged roles in a conspiracy to manipulate prices in the FX spot market.  The one-count indictment alleges that, from at least December 2007 through at least January 2013, the three traders conspired to fix prices and rig bids for U.S. dollars and euros exchanged on the FX spot market, ... Continue Reading

Spouse of Lawyer at International Law Firm Charged with Insider Trading

On July 12, Fei Yan, a post-doctoral associate at a Cambridge, Massachusett university was arrested and charged with insider trading.  Yan allegedly traded in options to buy stock in Stillwater Mining Company based on nonpublic information regarding a corporate acquisition that he obtained from his spouse, a lawyer working on the acquisition for a private international law firm.  Yan’s internet search history reflected online research into how to commit insider trading while evading detection.  Yan ... Continue Reading

Participants in Long Island Boiler Room Indicted for $147 Million Stock Manipulation Scheme

On July 12, 2017, a nine-count indictment against 14 defendants was unsealed, involving charges for conspiracy to commit securities fraud, conspiracy to commit wire fraud, conspiracy to commit money laundering, and substantive securities fraud.  The charges relate to alleged stock manipulation of five publicly traded companies: National Waste Management Holdings, Inc., CES Synergies, Inc., Grilled Cheese Truck, Hydrocarb Energy Corporation, and Intelligent Content Enterprises, Inc.  According to prosecutors, the defendants bought shares from corporate insiders ... Continue Reading

Nichicon Corporation Agrees to Plead Guilty for Fixing Prices of Electrolytic Capacitors

On July 11, 2017, Nichicon Corporation agreed to plead guilty and pay a $42 million criminal fine for its role in a conspiracy to fix prices for electrolytic capacitors, which store and regulate electrical current in a variety of electronic products.  Nichicon Corporation conspired with others to suppress and eliminate competition of electrolytic capacitors from at least November 2001 until December 2011.  Nichicon Corporation is the seventh company to be charged as part of this ... Continue Reading

Philadelphia District Attorney Rufus Seth Williams Pleads Guilty to Federal Bribery Charge

On June 29, 2017, Rufus Seth Williams, the Philadelphia District Attorney, pled guilty to a federal bribery charge for accepting tens of thousands of dollars’ worth of bribes.  According to the allegations in the charging documents and statements made in court proceedings, from July 2010 to May 2015, Williams entered into an agreement with Mohammad N. Ali, a business owner, to perform official acts for Ali, including contacting a Philadelphia police official in order to ... Continue Reading

Former Packaged Seafood Executive Pleads Guilty to Price Fixing

On June 28, 2017, Stephen Hodge, former senior vice president of sales for a packaged seafood company, pled guilty to charges related to his role in a conspiracy to fix the prices of packaged seafood sold in the United States.  According to court documents, Hodge and his co-conspirators discussed the prices of packaged seafood and issued price announcements in accordance with agreements they reached during these discussions.  Hodge is the fourth executive to plead guilty ... Continue Reading

Man Who Laundered Millions from Massive Computer Hacking and Telecommunications Fraud Scheme Gets 48 Months in Prison

On June 28, 2017, Muhammad Sohail Qasmani was sentenced to 48 months in prison in connection with a scheme to launder more than $19.6 million as part of a global computer hacking and telecommunications fraud scheme.  According to the documents filed in this and related cases, Noor Aziz of Karachi, Pakistan, allegedly led a scheme to  access without authorization the computer systems that ran the internal telephone networks of numerous businesses and organizations in the ... Continue Reading

Former State Street Corporation Executive Pleads Guilty in Scheme to Defraud Clients Through Secret Trading Commissions

On June 28, 2017, Edward Pennings, a former senior managing director at Boston-based State Street Corporation, pled guilty to one count of conspiracy to commit securities fraud and wire fraud.  According to Pennings’ admissions, Pennings conspired to add secret commissions to fixed income and equity trades performed for at least six clients of the bank’s “transition management” business—work that involved moving investments of institutional clients between and among asset managers or liquidating large investment portfolios—on ... Continue Reading

Operator of Unlawful Bitcoin Exchange Sentenced to More than 5 Years in Prison for Leading Multimillion-Dollar Money Laundering and Fraud Scheme

On June 27, 2017, Anthony R. Murgio was sentenced to 66 months in prison for operating an internet-based Bitcoin exchange through which Murgio processed more than $10 million in illegal Bitcoin transactions.  According to the Superseding Indictment and statements made during court proceedings, Murgio operated Coin.mx, the unlawful exchange, between 2013 and July 2015.  Coin.mx was founded in violation of federal anti-money laundering laws and regulations, including those requiring exchanges like Coin.mx to meet state ... Continue Reading

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