Posts Tagged With Cases of Interest

Four Defendants, Including Centers for Medicare and Medicaid Services Employee, Convicted in Insider Trading Scheme

On May 4, 2018, four defendants were convicted of trading on confidential nonpublic government information, following a four-week jury trial.  As part of defendants’ insider trading scheme, Christopher Worrall, an employee of the Centers for Medicare and Medicaid Services, provided confidential information to David Blaszczak, a political intelligence consultant.  Blaszczak then passed this information along to several employees at Deerfield Management Company, a hedge fund that retained Blaszczak as a consultant during the relevant time
Continue Reading

Former CEO of Volkswagen AG Charged with Conspiracy and Wire Fraud in Diesel Emissions Investigation

On May 3, 2018, authorities announced the unsealing of wire fraud and conspiracy charges against former Volkswagen AG (“VW”) CEO and board chairman Martin Winterkorn in connection with VW’s use of so-called “defeat device” software to cheat U.S. vehicle emissions testing.  Winterkorn is accused of conspiring with other VW executives and employees to defraud the United States, defraud VW’s U.S. customers, and to violate the Clean Air Act through false representations regarding the compliance of
Continue Reading

Panasonic Avionics Corporation Agrees to Pay $137 Million to Resolve Foreign Corrupt Practices Act Charges

On April 30, 2018, DOJ officials announced that Panasonic Avionics Corp. (“PAC”), a subsidiary of publicly traded Panasonic Corporation (“Panasonic”), agreed to pay a $137 million criminal penalty under a deferred prosecution agreement to resolve FCPA liability.  According to the agreement, PAC caused parent Panasonic to falsify its books and records with respect to improper payments that PAC made to third-party consultants and sales agents, in violation of the FCPA’s accounting provisions.  In addition to
Continue Reading

Former Venezuelan Official Pleads Guilty to Money Laundering Charge in Connection with Bribery Scheme

On April 19, 2018, Cesar David Rincon Godoy, a former general manager of the procurement subsidiary of Venezuelan state-owned energy company Petroleos de Venezuela S.A. (“PDVSA”), pleaded guilty to one count of conspiracy to commit money laundering.  The charge stemmed from an alleged scheme involving the payment of bribes by the owners of U.S.-based companies to Venezuelan government officials to secure contracts with PDVSA and payment priority on outstanding invoices.  According to admissions made in
Continue Reading

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.)

DOJ Press Release
Continue Reading

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

Related Proceeding Post
Continue Reading

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.)

DOJ Press Release
Continue Reading

LexBlog