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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:

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Top Ten Federal Financial Fraud Recoveries of 2019

Posted  01/17/20
top ten in letters
The U.S. government has a range on enforcement options for financial and investment fraud, including those that provide for whistleblower rewards such as the SEC Whistleblower Program, the CFTC Whistleblower Program, and the IRS Whistleblower Program, each of which are very much open for business and continuing to pay millions of dollars in whistleblower awards in exchange for their assistance in exposing...

January 13, 2020

San Francisco-based fund advisor Michael Rothenberg has been ordered to pay more than $31 million for misappropriating millions of dollars in client funds.  Instead of investing clients funds in emerging technology, the head of Rothenberg Ventures LLC allegedly funneled it toward personal business ventures and events, in violation of the antifraud provisions of the Investment Advisers Act of 1940.  As part of the settlement, Rothenberg has also agreed to be barred from the securities industry for five years.  SEC

Top Ten Non-Healthcare False Claims Act Recoveries of 2019

Posted  01/10/20
False Claims Act
This year, federal and state governments recovered hundreds of millions of dollars thanks to whistleblowers who came forward to report fraud under the federal False Claims Act and state False Claims Acts.  Whistleblowers reported a wide-range of misconduct involving government contracts, including fraud by defense contractors, airlines, and even a major research university.  Defendants’ deception ran the gamut...

January 9, 2020

After being charged with defrauding brokerage customers in May 2018 and pleading guilty in December 2018, a former registered investment advisor, Steven Pagartanis, has been sentenced to over 14 years in prison and ordered to pay $6.5 million for orchestrating the 18-year, $13 million fraud.  Pagartanis had targeted elderly women and promised an 8% return on investments.  However, he secretly laundered their investments and used the money on personal expenses, causing investors to lose over $9 million in total.   USAO EDNY

December 16, 2019

Steven (Kaveh) Shayan and Kevin (Kaveh) Shayan, who operated the website WeTakeSection8.com, have been permanently banned from offering rental listing services and ordered to pay more than $6 million following a complaint filed by the FTC.  The Shayans and their website falsely claimed that their subscription websites provided accurate, up-to-date rental listings that were approved for Section 8 housing vouchers, including properties with which they had exclusive listing agreements,  when, in fact, most of the listed properties were either unavailable or did not accept Section 8 housing vouchers. FTC

Catch of the Week: Ericsson Agrees to Pay Record-Setting $1 Billion for FCPA Violations

Posted  12/12/19
By Carolina Gonzalez
Candy gummy fish
This week’s “Catch of the Week” is a Swedish fish: Telefonaktiebolaget LM Ericsson, the telecommunications giant based in Stockholm, agreed to pay over $1 billion in penalties, including $540 million to the SEC and $520 million to the DOJ, for violating the Foreign Corrupt Practices Act (“FCPA”).  This is one of the largest FCPA settlements in history.  Ericsson’s corrupt conduct was pervasive and...

SEC Whistleblower Program 2019 Annual Report Tells Story of Significant Impact - Despite Beginning the Year with a Government Shutdown

Posted  12/12/19
Securities Exchange Commission Logo
In its 2019 Annual Report to Congress, the SEC Office of the Whistleblower described its program as continuing to have a “significant impact” on enforcement and investor protection efforts.  In the fiscal year that ended in September 2019, the SEC Whistleblower Program received the second highest number of tips in program history, and issued the third largest whistleblower award to date. These numbers...

December 12, 2019

Two oil and gas executives have settled insider trading charges with the SEC by agreeing to pay nearly $6 million in civil penalty, disgorgement, and prejudgment interest.  The two, John Davidson and John Special, allegedly purchased shares of medical device company, Covidien PLC, upon learning non-public information about a potential merger with Medtronic PLC.  When news of the merger was officially released, investment accounts controlled by the men earned over $1 million in illicit gains.  SEC

December 10, 2019

Internet service provider CenturyLink has entered into a $6.1 million settlement with the State of Washington, resolving allegations that the company added charges to customer bills without accurately disclosing those fees, and failed to provide discounts promised by sales agents.  While $900,000 of the settlement will be immediately distributed to affected customers, the remainder will be held pending resolution of a nationwide class action against the company.  WA

December 9, 2019

Colorado resident Jeffrey O. Friedland and two companies associated with him, Intiva Pharma LLC and Global Corporate Strategies LLC, have entered into a $4.2 million settlement -- $2.1 million in disgorgement plus a $2 million penalty and prejudgment interest -- with the SEC, resolving charges that Friedland and his companies fraudulently promoted the stock of cannabis company OWC Pharmaceutical Research Corp.  Friedland and his companies were alleged to have misrepresented their ownership interest in OWC, as well as Friedland's compensation in OWC stock in exchange for his promotion of the shares.  SEC
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