Whistleblower News From The Inside -- September 19, 2016

By the C|C Whistleblower Lawyer Team

Guilty Plea in $9 Million Investment Fraud – According to the plea, Sherman C. Vaughn held himself out as an experienced investment advisor, soliciting funds from individuals, then using those funds for personal living expenses instead of for the promised investments.  USAO E.D. Va.

Charges Brought against two Individuals Soliciting Investors for their Business Selling Marijuana Growing Containers – The individual defendants are alleged to have created fraudulent corporate documents that enabled their company Fusion Pharm to issue common stock to three other companies controlled by one of the invidual defendants, who then illegally sold the restricted stock into the market for $12.2 million in profits while hiding the companies’ connection to Fusion Pharm.  Some of the illegal proceeds were then transferred back to Fusion Pharm so the money could be falsely reported as revenue, and the company issued press releases and financial reports that misled investors to believe the revenue came from sales of the containers called PharmPods, steel shipping containers retrofitted and refurbished for use as hydroponic growing pods for indoor plant cultivation, primarily cannabis.  USAO D. Colo.; SEC

$90 Billion Whistleblower Suit Filed Against Four of the Nation’s Largest Chemical Companies – The recently-unsealed suit against BASF, Bayer Material Science, Dow, and Huntsman International, alleges that the companies concealed information regarding the dangers of isocyanates from the EPA in violation of the Toxic Substances Control Act.  The law firm of Kasowitz Benson et al. is the whistleblower.  EcoWatch

Whistle-blower prompts review of Tampa’s sewer management – The wastewater official made a detailed 11-page report to the mayor and requested protection from retaliation.  Tampa Bay Times