Posts Tagged With Cases of Interest

Cambridge, Massachusetts Man Sentenced in Manhattan Federal Court for Insider Trading

On March 30, 2018, Fei Yan, a post-doctoral associate at a university located in Cambridge, Massachusetts, was sentenced to 15 months in prison for insider trading.  Yan’s spouse worked at an international law firm where she learned material nonpublic information concerning the acquisition of Stillwater Mining Company, a publicly traded company whose shares are listed on the New York Stock Exchange.  According to court filings, while his spouse was working on the potential merger, Yan ... Continue Reading

Yevgeniy Nikulin Appears in U.S. Court Following Extradition

On March 30, 2018, a Russian national charged with illegally accessing and stealing data from the computers of LinkedIn, DropBox, and Formspring made his initial appearance in federal court, following his extradition from the Czech Republic.  The defendant, Yevgeniy Aleksandrovich Nikulin, had been indicted for the crimes in 2016 and was detained on an international warrant. United States v. Nikulin, 16-cr-00440 (N.D. Cal.)

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Barclays Agrees to Pay $2 Billion in Civil Penalties to Resolve Claims for Fraud in the Sale of Residential Mortgage-Backed Securities

On March 29, 2018, officials announced that Barclays Capital, Inc. and several of its affiliates agreed to settle a civil action brought in December 2016 in relation to the underwriting and issuance of residential mortgage-backed securities (“RMBS”) between 2005 and 2007.  Barclays agreed to pay $2 billion in civil penalties in exchange for dismissal of the government’s amended complaint.  The complaint alleged that Barclays misled investors about the quality of underlying mortgage loans in 36 ... Continue Reading

Indictment Charges Nine Iranian Citizens with Massive Cyber Theft of Documents and Data on Behalf of Iranian Government

On March 23, 2018, an indictment was unsealed charging nine Iranian citizens, all affiliated with the Iran-based Mabna Institute, with involvement in a coordinated campaign to steal intellectual property and academic data from a variety of U.S. and foreign targets.  The indictment alleged that, in total, the defendants stole more than 31 terabytes of material from targets that included universities, private sector companies, the U.S. Department of Labor, and the United Nations Children’s Fund.  Many ... Continue Reading

Iranian Citizen Charged with Involvement in Scheme to Avoid U.S. Economic Sanctions Against Iran by Funneling $115 Million from Venezuela Through U.S. Banks

On March 20, 2018, an indictment was unsealed alleging that Ali Sadr Hashemi Nejad, an Iranian citizen, evaded U.S. sanctions by funneling his company’s proceeds from a Venezuelan infrastructure project through the U.S. financial system.  According to the indictment, Nejad and a co-conspirator used false passports to incorporate entities in Switzerland and Turkey and to set up U.S.-dollar bank accounts for these entities in Switzerland.  By concealing the Iranian nexus to the payments, Nejad was ... Continue Reading

Former Siemens Executive Pleads Guilty to Involvement in $100 Million Bribery of Argentine Government Officials

On March 15, 2018, Eberhard Reichart, the former Technical Manager of Siemens Business Services’ Major Projects division, pleaded guilty to one count of conspiracy to bribe Argentine government officials.  According to court documents, Reichert was involved in a decades-long scheme to pay tens of millions of dollars in bribes to the Argentine officials in order to secure a contract to create national identity cards.  To effectuate payment of the bribes, Reichert and his co-conspirators created ... Continue Reading

Chief Executive and Four Associates Indicted for Conspiring with Global Drug Traffickers by Providing Encryption Services to Evade Law Enforcement and Obstruct Justice

On March 15, 2018, officials announced the indictment of the CEO of Canada-based encrypted communication device and services Phantom Secure, along with four associates, on charges of racketeering conspiracy and narcotics distribution conspiracy.  According to court documents, Phantom Secure advertised its devices and services as impervious to decryption, wiretapping, or legal records requests, and guaranteed that the company would remotely destroy evidence contained on customer devices in the event of compromise by informants or law ... Continue Reading

Transport Logistics International Inc. Agrees to Pay $2 Million Penalty to Resolve Foreign Bribery Case

On March 13, 2018, federal officials announced that they had resolved FCPA charges through a deferred-prosecution agreement (“DPA”) against a Maryland-based nuclear material transportation company.  According to court documents, Transport Logistics International, Inc. (“TLI”) conspired with others to pay more than $1.7 million in bribes to an official of Russian state-owned JSC Techsnabexport to secure improper business advantages and obtain or retain business.  TLI executives reportedly caused fake invoices to be prepared to create the ... Continue Reading

Martin Shkreli Sentenced to Seven Years’ Imprisonment for Multimillion-Dollar Fraud Scheme

On March 8, 2018, Martin Shkreli was sentenced to seven years’ imprisonment for committing securities fraud and securities fraud conspiracy.  A jury found that Shkreli, a former hedge fund manager and CEO of the biopharmaceutical company Retrophin Inc., made false representations and omissions to defraud investors.  Shkreli was also convicted, alongside former Retrophin outside counsel Evan Greebel, of illegally attempting to control the price and trading volume of Retrophin’s stock.  In addition to his prison ... Continue Reading

False Claims Act Complaint Charges Pharmacy, Two Pharmacy Executives, and Private Equity Firm with Participation in Kickback Scheme

On February 23, 2018, DOJ announced that it was intervening in an FCA suit brought by two former employees against a Florida pharmacy, Diabetic Care Rx LLC, doing business as Patient Care America.  DOJ’s complaint in intervention alleges that the pharmacy paid illegal kickbacks to induce prescriptions for drugs reimbursed by TRICARE, a federally funded health care program for members of the military and their families.  Two pharmacy executives were also named in the complaint, ... Continue Reading

Former CEO of Tech Company Pleads Guilty to Insider Trading

On February 21, 2018, Peter C. Chang, the former President and CEO of Directors of Alliance Fiber Optic Products (“AFOP”), pleaded guilty to insider trading and tender offer fraud.  AFOP, which is publicly traded on the NASDAQ, is a manufacturer of fiber optic components.  As part of his guilty plea, Chang admitted that he traded AFOP stock through brokerage accounts in the names of his wife and brother sold AFOP stock before two public announcements ... Continue Reading

Former Assistant Trader at Chicago Firm Charged with Misappropriating $2 Million in Bitcoin, Litecoin

On February 15, a former Chicago-based trader, Joseph Kim, was charged with fraud arising from his alleged misappropriation of $2 million in cryptocurrency.  Kim is alleged to have covered his own losses in trading cryptocurrency futures by shifting more than $2 million of Bitcoin and Litecoin from the accounts of his employer, Consolidated Trading LLC, to his personal account.  Kim is also alleged to have lied to the company when asked to account for the ... Continue Reading

New Jersey Hedge Fund Owner Convicted of Wire Fraud and Securities Fraud

On February 15, 2018, a jury convicted Nicholas Lattanzio, the owner and manager of the hedge fund Black Diamond Capital Appreciation Fund L.P., of defrauding investors in his hedge fund of over $4 million.  According to the evidence at trial, Lattanzio collected the fees from investors promising to provide future loans and investment opportunities, but instead used the fees for personal expenses. United States v. Lattanzio, 15-cr-446 (D.N.J.)

DOJ Press Release

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Manhattan U.S. Attorney Announces Criminal Charges Against U.S. Bancorp for Violations of the Bank Secrecy Act

On February 15, 2018, the DOJ announced that it was charging U.S. Bancorp (“Bancorp”) with two counts of violating the Bank Secrecy Act, based on conduct by its subsidiary, U.S. Bank NA (“U.S. Bank”), the fifth largest bank in the United States.  The DOJ agreed to defer prosecution for two years based on an agreement with U.S. Bank, in which it will pay a $528 million criminal penalty and undertake efforts to reform its Bank ... Continue Reading

Two Russian Nationals Involved in Global Hacking Scheme Sentenced to Federal Prison Terms

On February 14, two Russian nationals were sentenced for their involvement in a scheme that hacked the systems of corporate victims to steal credit card numbers for resale worldwide.  Vladimir Drinkman was sentenced to 144 months in prison, and Dmitriy Smilianets was sentenced to 51 months.  The two defendants, as well as three others who are fugitives, caused hundreds of millions in losses in a scheme that compromised 160 million credit card numbers.  The scheme ... Continue Reading

Five Former Venezuelan Government Officials Charged in Money Laundering Scheme Involving Foreign Bribery

On February 12, 2018, five former officials of Venezuela’s state-owned energy company were charged with laundering the proceeds of bribes.  According to the indictment, the defendants—all of whom were at the time officials of state-owned Petroleos de Venezuela S.A. (“PDVSA”) or other Venezuelan government instrumentalities—conspired to launder the proceeds of bribes that several of them had solicited from vendors in exchange for offering the vendors preferential treatment in dealings with PDVSA.  The five individuals allegedly ... Continue Reading

Thirty-Six Defendants Indicted for Alleged Involvement in Global Cyberfraud Organization

On February 7, a Las Vegas grand jury returned a nine-count superseding indictment charging 36 individuals from the United States and six other countries with involvement in an international cyberfraud enterprise.  All 36 individuals were alleged to be involved in the “Infraud Organization,” an Internet-based fraud organization alleged to have cost $2.2 billion in losses to victims since 2010.  The organization is alleged to have trafficked largely in identity theft and hacking, and its victims ... Continue Reading

Rabobank NA Pleads Guilty, Agrees to Pay Over $360 Million in Connection with Anti-Money Laundering Failures

On February 7, 2018, Rabobank National Association (“Rabobank”), a U.S. subsidiary of Netherlands-based Cooperative Rabobank U.A., pleaded guilty to one count of conspiracy to defraud the United States and to corruptly obstruct the examination of a financial institution.  According to court filings, Rabobank executives conspired to conceal significant deficiencies in the bank’s Bank Secrecy Act (“BSA”) and anti-money laundering (“AML”) program and to obstruct a periodic examination of Rabobank’s Southern California operations by the Office ... Continue Reading

New York Man Sentenced to 87 Months for Multi-State Biodiesel Fraud Scheme

On February 6, 2018, Andre Bernard was sentenced to 87 months in federal prison in connection with a multi-state scheme to defraud biodiesel buyers and U.S. taxpayers.  According to court documents and his plea colloquy, Bernard and his co-conspirators fraudulently claimed tax credits for already-credited renewable fuels by using a series of false transactions to transform the fuel back into feedstock in order to produce more renewable fuel.  Between March 2013 and March 2014, Bernard ... Continue Reading

Hedge Fund Manager Charged in Manhattan Federal Court with Scheme to Defraud Investors

On February 2, 2018, Nicholas Genovese was charged with securities fraud and wire fraud for allegedly inducing investments in a hedge fund that he founded, Willow Creek Investments LP, by misrepresenting his credentials and work experience.  Based on these representations, victims invested at least $4 million with Willow Creek.  When investors attempted to regain their investments, Genovese refused to return their money. United States v. Genovese, 18-cr-183 (S.D.N.Y.)

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Former CEO of Detroit Information Technology Company Indicted for Bribery of City Official

On January 30, 2018, John P. Cronan, the Acting Assistant Attorney General of the Criminal Division announced that the former CEO of a Detroit information technology company had been indicted for his role in bribing a public official.  Parimal Mehta, the former CEO, is alleged to have made payments to the former Director of Detroit’s Office of Departmental Technology Services Charles Dodd.  In exchange, he is alleged to have secured favorable treatment for his company—adding ... Continue Reading

Arkansas State Senator Pleads Guilty to Wire Fraud, Money Laundering and Bank Fraud

On January 29, 2018, Arkansas State Senator Jake C. Files pled guilty before Chief U.S. District Court Judge P. K. Holmes III of the Western District of Arkansas to an information charging him with one count of wire fraud, one count of money laundering, and one count of bank fraud.  Files admitted that, between August 2016 and December 2016, he used his government position to obtain state funds, known as General Improvement Funds (“GIF”), through ... Continue Reading

Three Defendants Convicted in Securities Fraud Investigation

On January 26, 2018, federal officials announced that three additional individuals have pled guilty to conspiracy charges in connection with several “pump and dump” and other stock manipulation schemes involving fraudulently registered companies.  According to public statements from the U.S. Attorney’s Office for the Southern District of Florida and court filings, owner of stock transfer agent Manhattan Transfer Registrar Co. (“Manhattan Transfer”) John Ahearn and California attorney Andrew H. Wilson each pled guilty to one ... Continue Reading

Sixth Major Bank Pleads Guilty to Antitrust Conspiracy in Ongoing Foreign Currency Exchange Investigation

On January 25, 2018, BNP Paribas USA Inc. (“BNPP USA”) a subsidiary of BNP Paribas S.A., pled guilty to participating in a price-fixing conspiracy in the foreign currency exchange (“FX”) market.  The one-count information filed in the Southern District of New York alleges that between September 2011 and July 2013, BNPP USA engaged in a conspiracy to suppress competition by manipulating prices on an electronic FX trading platform in violation of the Sherman Act.  The ... Continue Reading

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