Whistleblower Group

February 24, 2016

New York, together with 21 other states, announced multimillion dollar settlements with Natixis Funding Corp. and Societe Generale for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Natixis and Societe Generale will pay $29,950,000 and $26,750,000 respectively as part of a coordinated 22-state and private class settlement. Pursuant to the settlements, $53,865,000 will be paid into a Settlement Fund and largely applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Natixis or Societe Generale. NY, NJ, FL

February 24, 2016

The CFTC filed charges against Florida resident Neil Pecker and his company, Vision Financial Partners, LLC, alleging they engaged in fraud in connection with off-exchange binary options and registration violations.  The CFTC complaint alleges that the defendants solicited almost $3 million from over 120 clients in the U.S. and Canada while misappropriating almost $2 million of the funds for their personal use.  CFTC

February 24, 2016

The FTC has charged a debt relief operation with falsely representing to financially distressed homeowners and student loan borrowers that it would help get their mortgages and student loans modified. According to the FTC’s complaint, Good EBusiness LLC, using the name The AAP Firm, and Tobias West deceptively marketed home loan modification services and illegally charged an advance fee of between $1,000 to $5,000. The agency alleges that the defendants falsely claim that they can lower consumers’ monthly mortgage payments, often quoting a specific amount, and reduce their mortgage interest rates, usually within a few months, and falsely promise full refunds if they fail. FTC

February 23, 2016

The CFPB filed two orders against Citibank relating to the bank’s illegal debt sales and debt collection practices.  The bureau ordered Citibank to provide nearly $5 million in consumer relief and pay a $3 million penalty for selling credit card debt with inflated interest rates and failing to forward consumer payments promptly to debt buyers.  Separately, the CFPB ordered Citibank to comply with a court order requiring the bank to refund $11 million to consumers and forgo collecting an additional $34 million for filing altered affidavits in debt collection litigations.   CFPB

February 23, 2016

The Justice Department announced that the owner of a St. Louis, Missouri, tax return preparation business was arrested on two counts of tax evasion. According to the indictment, from 2005 to 2011, Semere Tsehaye, 38, was the owner and operator of at least 20 Instant Tax Service franchise locations operating in Illinois, Kansas, and Missouri. Instant Tax Service was a brand name of ITS Financial LLC, a nationwide tax preparation business headquartered in Dayton, Ohio. During the years 2010 and 2011, Tsehaye is alleged to have generated fraudulent financial summaries that understated gross receipts by a total of approximately $506,000 in 2010 and $1.03 million in 2011. DOJ

February 22, 2016

Michigan filed felony charges against a former Motor City Casino dealer and six others for their roles in an alleged scheme to steal money from the casino involving hundreds of dollars of individual player payouts on lost bets during games of Texas Hold ‘em. The charges were filed following an investigation by the Michigan State Police after they were asked by Motor City Casino to investigate possible dealer/player collusion. The felony complaints allege that Darryl Green, who was employed as a dealer at Motor City Casino in 2014 when the alleged acts took place, conspired with the other six defendants to make payouts to them on losing bets or simply not collect payment on lost bets. MI