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Financial and Investment Fraud

This archive displays posts tagged as relevant to financial and investment fraud. You may also be interested in the following pages:

Page 1 of 64

July 14, 2021

Following a lawsuit filed by the FTC in 2018, online lender LendingClub has agreed to pay $18 million to settle claims of deceiving consumers about hidden fees, misrepresenting consumers’ approvals for loans, and withdrawing money from consumer bank accounts without authorization.  In addition to the monetary penalty, LendingClub is now required to clearly and conspicuously disclose all fees, as well as the total amount of funds being borrowed.  FTC

July 13, 2021

A subsidiary of Teachers Insurance and Annuity Association of America (TIAA) has agreed to pay $97 million in restitution and make significant reforms to settle charges for making misleading statements and failing to disclose conflicts of interests to tens of thousands of customers.  Between 2012 and 2018, advisors with TIAA-CREF Individual & Institutional Services LLC (TC Services) pressured customers—many of them teachers and public sector employees—to move their investments from low-cost employer-sponsored retirement plans to higher-cost individually-managed accounts, which generated hundreds of millions of dollars in fees for TIAA.  NY AG; SEC

July 12, 2021

A non-bank institution in Georgia called GreenSky, LLC has been ordered to refund or cancel up to $9 million in fraudulent loans, pay a $2.5 million civil penalty, and implement new procedures to prevent future financial abuse.  According to the CFTC, GreenSky’s inappropriate and ineffective controls enabled third-party merchants to take out loans on behalf of thousands of consumers without their knowledge or authorization.  In addition to the financial resolution, GreenSky is now required to verify consumer identities and confirm authorizations before activating or disbursing loans, implement a consumer complaint management program, and properly oversee third-party merchant partners.  CFTC

July 2, 2021

Roger Nils-Jonas Karlsson of Sweden has been sentenced to 15 years in prison and ordered to forfeit more than $16 million, including several properties and a resort in Thailand, in one of the largest cryptocurrency Ponzi schemes ever prosecuted in the United States.  Starting in 2011 until his arrest in Thailand in 2019, Karlsson induced thousands of investors from around the country and over 45 countries around the world to use cryptocurrency to purchase shares in an entity he called Eastern Metal Securities, by falsely claiming that it was run by award-winning economists and had zero risk of loss.  He then misappropriated at least $1.5 million to fund a lavish lifestyle for himself.  USAO NDCA; DOJ; SEC

June 29, 2021

Accountant Steven Brown, who operated a financial consulting and investment company called Alpha Trade Analytics, Inc., has been sentenced to over 4 years in prison and ordered to pay over $3.3 million in restitution for running a Ponzi scheme that affected 48 victims, many of whom were connected to a nonprofit that provided dance and theater arts education to children.  Through his role as an accountant for the nonprofit, Brown received access to high-net-worth individuals, whom he encouraged to invest with Alpha Trade through false promises.  When it came time to pay out investors, Brown used funds from new investors, as well as funds embezzled from the nonprofit.  USAO CDCA

June 29, 2021

A man in Minnesota who allegedly defrauded two dozen investor clients out of $2.3 million has been sentenced to 7 years in prison.  Isaiah Leslie Goodman, a registered investment advisor and owner of Becoming Financial Group, Inc., Becoming Financial Advisory Services L.L.C., and MoneyVerbs, allegedly lied to prospective and existing clients while misappropriating their funds for his own use.  As part of his sentence, Goodman will forfeit some of his ill-gotten gains.  USAO MN

June 24, 2021

A whistleblower whose information and ongoing assistance led to multiple SEC enforcement actions has been awarded more than $1 million.  According to the agency, the whistleblower played a critical role in the enforcement actions by prompting the investigation and saving the agency significant time and resources.  SEC

June 21, 2021

The SEC has issued awards totaling nearly $5.3 million to whistleblowers whose information caused the SEC to launch investigations that ultimately resulted in successful enforcement actions.  In the first award, a whistleblower received nearly $4 million for extraordinary assistance, including providing documents, identifying witnesses, and participating in hours of interviews.  In the second award, three whistleblowers received about $1.3 million for providing ongoing assistance that conserved agency time and resources.  SEC

Flood of SEC Whistleblower Awards Continues

Posted  06/17/21
Securities and Exchange Commission logo with a stack of coins and cash on top
It has been less than two months since SEC Whistleblower Chief Jane Norberg left the agency for private practice.  As we previously wrote, her five years running the agency's Whistleblower Program were groundbreaking in the number and amount of awards the SEC made and in the agency's efforts to champion the critical role whistleblowers play within the SEC enforcement regime. As we also wrote at the time, the SEC...
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