Bankrupt Banker

Hernan Arbizu has been arrested in Argentina on charges that he stole $5 million from the accounts of customers at UBS AG and JPMorgan Chase

Hernan Arbizu was arrested Monday in Buenos Aires on charges filed in U.S. District Court in May.Arbizu was a vice president in the private banking division at JPMorgan when he embezzled the money between March 2007 and April 2008, prosecutors said. He caused $5.37 million to be transferred out of private banking accounts at the UBS (nyse: UBS - news - people ) and JPMorgan financial services companies during that time, they said.Arbizu was responsible for maintaining and developing private banking relationships in Latin America at the time, court papers said.It wasn't immediately clear who would represent Arbizu on charges of embezzlement, bank fraud and aggravated identity theft.U.S. authorities were seeking to extradite Arbizu to New York.If convicted, Arbizu, 41, could face up to 30 years in prison and more than $5 million in fines.A spokesman for JPMorgan, which fired Arbizu in May, said the company "appreciates the cooperation and the prompt joint action of the Argentine and American authorities."

Hernan Arbizu has been arrested in Argentina on charges that he stole $5 million from the accounts of customers at UBS AG and JPMorgan Chase

Hernan Arbizu was arrested Monday in Buenos Aires on charges filed in U.S. District Court in May.Arbizu was a vice president in the private ...

Lou Pai, the former chief executive of Enron Energy Services, charged with improperly selling hundreds of thousands of Enron shares in 2001.

Lou Pai, the former chief executive of Enron Energy Services, with improperly selling hundreds of thousands of Enron shares in 2001.The stock market regulator said Mr Pai sold the shares after being informed that the Enron subsidiary had sustained substantial losses, but before the losses had been reported publicly. Mr Pai, who has neither admitted nor denied the SEC's charges, has reached a settlement with the SEC under which he has agreed to pay a $US1.5 million ($1.6 million) fine. The former Enron high-flyer has also agreed to pay $US30 million in disgorgement of his gains and other related fees relating to the allegedly improper stock trades. “The commission has never relented in pursuing fraud committed by Enron's executives, and I am pleased that today's settlement will add another $US25.5 million to the Enron Fair Fund for the benefit of injured investors,” said Linda Chatman Thomsen, the SEC's enforcement chief. The charges and settlement with Mr Pai come seven years after the collapse of Enron, which once was one of America's biggest energy trading companies. Enron's 2001 collapse amid an accounting scandal and wide-ranging government and congressional probes into its accounting practices was one of the biggest scandals in US corporate history. Other former top Enron executives have faced prosecution and been jailed for their roles in trying to cover up the accounting fraud. Enron's former chief executive, Jeffrey Skilling, is serving a 24-year sentence in a federal prison. His co-defendant, former Enron chairman Kenneth Lay, was found guilty of fraud and banking violations, but died in 2006 of apparent heart failure before he was sentenced. Mr Pai is barred from working as an executive or director of a public company for five years.

Lou Pai, the former chief executive of Enron Energy Services, charged with improperly selling hundreds of thousands of Enron shares in 2001.

Lou Pai, the former chief executive of Enron Energy Services, with improperly selling hundreds of thousands of Enron shares in 2001.The stoc...

Financial Services Authority, the UK's financial regulator, said eight people were arrested across London and the south-east of England

The Financial Services Authority, the UK's financial regulator, said eight people were arrested across London and the south-east of England on Tuesday as part of a major inquiry into insider dealing.In a brief statement, the FSA said a team of 40 of its staff, backed by officers from the City of London police, had also searched premises across the region."This is a major investigation for the FSA," a spokeswoman for the watchdog said, declining to provide further details. The City of London police declined to comment.The FSA, long accused of not doing enough to tackle insider dealing and market abuse, has this year taken a tougher approach, more than doubling its team of lawyers and investigators with criminal expertise.The watchdog, which until earlier this year had not brought any criminal prosecutions for insider dealing since acquiring the power to do so in 2001, currently has three insider dealing cases involving five defendants before the courts.They include Malcolm Calvert, a partner at investment bank Cazenove until he retired in 2000, who last week pleaded not guilty to several charges of using privileged information on a string of mergers or takeovers between 2003 and 2005. In March, the FSA persuaded the government to give it the power to grant key witnesses immunity from prosecution in return for giving evidence, in a move that could introduce a U.S.-style whistleblower system to the UK.

Financial Services Authority, the UK's financial regulator, said eight people were arrested across London and the south-east of England

The Financial Services Authority, the UK's financial regulator, said eight people were arrested across London and the south-east of Engl...

Securities and Exchange Commission filed an action to halt what regulators said was an ongoing fraud in the sale of stock by Aerokinetic Energy Corp

Securities and Exchange Commission filed an emergency action to halt what regulators said was an ongoing fraud in the sale of stock by Aerokinetic Energy Corp. and its president, Randolph Bridwell.Acting on the SEC’s request, Judge James Whittemore of the U.S. District Court for the Middle District of Florida in Tampa issued a temporary restraining order and an asset freeze over Aerokinetic’s bank account. According to the SEC’s complaint, Aerokinetic and Bridwell raised at least $535,000 from 24 investors nationwide and are currently seeking to raise another $575,000 through a fraudulent offering of unregistered securities. The SEC said Bridwell misappropriated investors’ funds to pay personal expenses and it cannot account for $230,00 in investor funds.Aerokinetic, based in Sarasota, claims to be in the business of researching, developing and marketing alternative power technologies and other innovative products, the SEC complaint says. The company and Bridwell claimed to have developed a power generation station that is capable of creating electrical energy at a fraction of the cost of conventional or nuclear means and to have developed an electric car that has attracted the interest of prominent individuals such as Lee Iacocca, Brad Pitt, Arnold Schwarzenegger and Al Gore, the complaint says.The defendants also told investors and potential investors that they project millions of dollars in sales within the first years of operation and billions of dollars thereafter, according to the complaint.The SEC said the claims are patently false and that Aerokinetic has no patients, license agreements, contracts, suppliers, customers, sales, revenue or market share.The temporary restraining order will be in effect until Aug. 4. The court has scheduled a hearing for a preliminary injunction on Aug. 1.

Securities and Exchange Commission filed an action to halt what regulators said was an ongoing fraud in the sale of stock by Aerokinetic Energy Corp

Securities and Exchange Commission filed an emergency action to halt what regulators said was an ongoing fraud in the sale of stock by Aerok...

Hernan E. Arbizu former J.P. Morgan Chase & Co. (JPM) private banker was arrested in Argentina on criminal charges

former J.P. Morgan Chase & Co. (JPM) private banker was arrested in Argentina on criminal charges in connection with the alleged embezzlement of nearly $5.4 million from clients.According to an indictment unsealed Monday, Hernan E. Arbizu, a former vice president and senior private banker, was charged with embezzlement by a bank officer, bank fraud, identity theft and 12 counts of wire fraud. Arbizu, 41 years old, was arrested in Buenos Aires on Monday. He remains in custody in Argentina pending extradition.Arbizu, who was originally charged in a criminal complaint in May, faces up to 30 years in prison on each count of wire fraud, bank fraud and embezzlement.At one point, Arbizu was the relationship manager responsible for maintaining and developing private banking relationships in Latin America, according to court papers.Prosecutors allege that Arbizu caused about $5.38 million in unauthorized wire transfers from accounts held at UBS AG (UBS) and J.P. Morgan between March 2007 and April 2008, including nearly $2.8 million in four transactions on April 15, 2008, according to the indictment. The government also alleges Arbizu used the names and account numbers of J.P. Morgan and UBS customers without their authorization to initiate the transfers, according to court papers.The criminal investigation is being handled by the U.S. Attorney's office in Manhattan and the Federal Bureau of Investigation.In June, J.P. Morgan sued Arbizu, who at one point managed more than $200 million in client assets, in U.S. District Court in Manhattan, alleging he stole confidential and proprietary information about the bank and its clients. The bank also filed a claim against him with the Financial Industry Regulatory Authority.In its suit, J.P. Morgan claimed it discovered in May that Arbizu engaged in unauthorized wire transfers between a JPMorgan client's account and accounts at other firms. J.P. Morgan also alleged Arbizu copied, downloaded and collected proprietary and confidential information and materials belonging to JPMorgan and its clients, including names, addresses, Social Security numbers and client financial information. The bank said he fled to Argentina and was subsequently terminated, according to the lawsuit."We appreciate the cooperation and the prompt joint action of the Argentine and American authorities," J.P. Morgan said in a statement Tuesday. The bank declined further comment due to pending litigation against Arbizu in the U.S.

Hernan E. Arbizu former J.P. Morgan Chase & Co. (JPM) private banker was arrested in Argentina on criminal charges

former J.P. Morgan Chase & Co. (JPM) private banker was arrested in Argentina on criminal charges in connection with the alleged embezzl...

£220 million attempt to hack into Sumitomo Matsui Banking Corporation's systems, and a £70 million attempted fraud within HSBC's securities services

KPMG said the record sum was fuelled in part by two big cases, namely an alleged £220 million attempt to hack into Sumitomo Matsui Banking Corporation's systems, and a £70 million attempted fraud within HSBC's securities services division. But it added that even without these two cases, there was still more than £60 million of fraud against financial institutions coming to court, compared with just £37 million during the whole of 2007.There were nine cases of mortgage fraud worth more than £20 million during the first half of the year, compared with only 10 cases worth £3.7 million throughout 2007.Overall, there were 128 different fraud cases against all sectors totalling more than £631 million going through the courts during the first six months of the year, a substantial increase on the 91 cases worth £421 million during the previous six-month period.Hitesh Patel, partner at KPMG Forensic, said: "The cases in this period's fraud barometer largely predate the credit crunch in terms of when the frauds were committed - the fear is that we will not see the real and full fraud impact of the crunch for another six or 12 months or even more, as businesses start to take a closer look at their operations in this difficult economic climate."The signs are that we could end up seeing some substantial losses being suffered."Two-thirds of fraud by value and more than half by number were carried out by organised gangs, with the financial services sector the main target, followed by investors, and the previous number one target of Government offices.

£220 million attempt to hack into Sumitomo Matsui Banking Corporation's systems, and a £70 million attempted fraud within HSBC's securities services

KPMG said the record sum was fuelled in part by two big cases, namely an alleged £220 million attempt to hack into Sumitomo Matsui Banking C...

Linda Edwards and Ladonna Mullins were convicted of wire fraud, making false statements, false use of a Social Security number

Linda Edwards, 55, of Centennial, and Ladonna Mullins, 73, of Denver, were convicted of wire fraud, making false statements, false use of a Social Security number, making false statements to a financial institution, and criminal forfeiture. They were convicted after a 14-day jury trial in federal court in Denver. Mullins worked as a real estate agent doing business through “LaDonna’s Realty and Management” in Denver, according to the indictment. Edwards worked as a real estate agent doing business through “Affable Realty” in Aurora.From 1999 through 2004, Edwards and Mullins assisted would-be homebuyers who couldn’t legitimately qualify for mortgages insured by the Federal Housing Administration, according to the indictment.Edwards, Mullins and others working with them obtained false Social Security numbers to conceal a buyer’s bad credit history; created false W-2s or other income documents that inflated or created income; and created false verifications of rent or employment, alternate credit letters or “gift letters” stating that the buyer had enough funds for the down payment, according to the indictment.They are scheduled to be sentenced by U.S. District Court Judge Marcia Krieger on Dec. 15. Edwards faces up to 20 years for wire fraud, and five years on each of the charges of false statements and false use of a Social Security number, plus fines of $250,000 for each crime, and forfeiture of all property involved in the scheme.Mullins faces up to five years for wire fraud, plus a $250,000 fine and forfeiture.

Linda Edwards and Ladonna Mullins were convicted of wire fraud, making false statements, false use of a Social Security number

Linda Edwards, 55, of Centennial, and Ladonna Mullins, 73, of Denver, were convicted of wire fraud, making false statements, false use of a ...

Big Four auditing firm KPMG, LLP has been ordered by a New Jersey Superior Court judge to stand trial in a massive accounting fraud lawsuit.

Eagan O'Malley & Avenatti today announced that Big Four auditing firm KPMG, LLP has been ordered by a New Jersey Superior Court judge to stand trial in a massive accounting fraud lawsuit. Cast Art Industries, LLP v. KPMG, LLP, Superior Court of New Jersey Law Division - Middlesex County (Docket No. MID L-3295-03). Cast Art sued KPMG in 2003 for professional malpractice and negligence for allegedly failing to detect a pervasive financial fraud at Papel Giftware, Inc. prior to Cast Art acquiring Papel in December 2000 for nearly $50 million. In a just released written opinion, The Honorable Judge Heidi Willis Currier found sufficient evidence for a jury trial to proceed against KPMG, Papel's auditor. In one e-mail uncovered during the lawsuit, a member of Papel's management described how the company had "raped and pillaged to an extreme" in order to meet its forecasts. A KPMG partner later acknowledged, in a memorandum he sent to others at KPMG, that Papel's management could not be trusted. Despite this, KPMG repeatedly represented to Cast Art and others that Papel's financial statements were accurate and no fraud had occurred. "Wall Street, Main Street, investors, and the public at large depend on auditing firms to be truthful and accurate when reporting on the financial condition of company," stated Michael Avenatti, a lawyer for Cast Art. "In this case, like in too many others, KPMG cut every possible corner and fell woefully short." Earlier this year, a court-appointed investigation blasted KPMG for sanctioning dubious accounting practices at New Century Financial Corp., thereby assisting in the collapse of the subprime lender and contributing to the subprime market meltdown. Cast Art claims that for three years prior to its acquisition of Papel, KPMG repeatedly affirmed that Papel's financial statements were accurate when in reality the company's management had engaged in a number of fraudulent schemes designed to inflate the value of the company to potential buyers. Cast Art alleges that Papel's management booked tens of thousands of fraudulent transactions on the company's books and records by, among other things, purposely shipping product to phony customers and double and triple shipping the same product to the same customer. Cast Art plans to seek close to $50 million at trial. Cast Art is represented in the lawsuit by Michael J. Avenatti of the California law firm Eagan O'Malley & Avenatti, LLP and Alan Wasserman of the New Jersey law firm Wilentz, Goldman & Spitzer, P.A. Opening statements are expected to begin in the trial on September 15, 2008

Big Four auditing firm KPMG, LLP has been ordered by a New Jersey Superior Court judge to stand trial in a massive accounting fraud lawsuit.

Eagan O'Malley & Avenatti today announced that Big Four auditing firm KPMG, LLP has been ordered by a New Jersey Superior Court judg...

FBI is investigating possible fraud at IndyMac

The FBI is investigating possible fraud at IndyMac, the California lender which was seized by regulators last Friday after America's biggest high street bank failure for two decades. Law enforcement sources told the Associated Press that the inquiry revolved around home loans made by IndyMac to risky borrowers and was focused on the bank itself, rather than on individuals who ran it.The FBI declined to comment on IndyMac specifically, although a spokesman said the scope of the bureau's examination of the sub-prime mortgage industry had broadened from 19 inquiries to 21 since April. A spokesman said: "We receive information from a variety of sources on a daily basis, and we have an obligation to review each allegation on its merits." Banking regulators took over IndyMac after a run on deposits, as customers withdrew $1.3bn in 10 days. At its peak, IndyMac had assets of $32bn. Under a federal insurance scheme, the first $100,000 of savings for each depositor is guaranteed. But anxious customers continued queueing outside branches to withdraw savings this week. Pasadena-based IndyMac is the fifth US bank to close this year, and is the biggest failure since the Chicago bank Continental Illinois collapsed in 1984. An estimated 10,000 customers could lose unprotected deposits of some $1bn. A New York senator, Charles Schumer, who wrote a public letter in June raising concerns about lax lending at IndyMac, has been blamed by the Office of Thrift Supervision for inciting panic among customers. Schumer argues that the OTS is responsible for allowing the bank to become vulnerable in the first place. IndyMac's demise has prompted jitters about other regional banks. Seattle-based Washington Mutual and Ohio's National City Corporation were obliged to issue statements denying liquidity crises this week after their shares plunged.

FBI is investigating possible fraud at IndyMac

The FBI is investigating possible fraud at IndyMac, the California lender which was seized by regulators last Friday after America's big...

UBS, is under hot water after it was revealed today that they allegedly helped hide up to $20 billion belonging to their richest American clients

UBS, is under hot water after it was revealed today that they allegedly helped hide up to $20 billion belonging to their richest American clients in European and off-shore banks to avoid paying taxes to the IRS.The news has many in Washington up in arms, and a senate committee has called a hearing for Thursday. They want to meet with UBS representatives, who allegedly "set up sham entities for the US clients in tax havens, such as Panama or the British Virgin Islands, and pose as the owners of the entities." One UBS banker has pled guilty to smuggling cash and diamonds to Europe so U.S. clients could avoid paying taxes.Phil Gramm has worked for UBS since leaving the U.S. Senate immediately after using his position as a Senator to remove six-decade-old consumer banking protections in place since the Great Depression. The 1999 Gramm law, called the Gramm-Leach-Bliley Act, is the main cause of the subprime mortgage meltdown that has crippled the U.S. economy. Gramm deregulated the banking industry, quit the Senate to leave for UBS, then lobbyied George W. Bush on behalf of UBS to remove remaining state laws that protect consumers from predatory lending. Scandals are nothing new to the Gramm family. Around the same time Gramm was lining his pockets by laying the groundwork to destroy our economy, his wife Wendy used her power as a government official to delay investigations into Enron wrongdoing. Wendy Gramm then quit to take a position on the Enron board of directors. Wendy Gramm later was sued for her part in insider trading and paid a $13 million fine with her own money.Phil Gramm is also the same person who last week said that America was not in a recession, that the problem is that "America is a nation of whiners". John McCain tried to distance himself from Gramm after a firestorm erupted over that comment, even going so far as to claim Gramm would take a smaller role in his campaign.If the mainstream press connect the dots and put UBS and Phil Gramm together it could and should mark the end of any major influence Gramm has on the McCain campaign. Some people from UBS, and some U.S. tax dodgers will likely go to prison as well.A scandal like this would historically be a crippling blow to a presidential campaign, but don't expect much negative coverage tying McCain to Gramm and UBS. The war profiteering defense contractors who own the media today refuse to eat their own

UBS, is under hot water after it was revealed today that they allegedly helped hide up to $20 billion belonging to their richest American clients

UBS, is under hot water after it was revealed today that they allegedly helped hide up to $20 billion belonging to their richest American cl...

Harriette Walters is in federal custody on money laundering, bank fraud and other charges

Harriette Walters was generous with her friends.She showered the people she met with cash they used to buy fancy vacations, designer goods, fur coats, cars and homes. Those friends included a bank teller, hair salon owner, luxury goods saleswoman and an IRS tax official. But federal prosecutors say the gifts were more than generosity.The midlevel official in the District of Columbia's tax office used them to recruit the network she would need to steal roughly $50 million from D.C.'s coffers, prosecutors said in federal court filings in Washington and Maryland. Walters is in federal custody on money laundering, bank fraud and other charges. Her attorney, Steven Tabackman, would not comment on the investigation. Seven of the 13 friends and relatives charged in the case so far have pleaded guilty, and their pleas provide a window into what prosecutors say is broad scheme that eluded detection for about two decades.She wrote fake property tax refund checks to shell firms controlled by relatives and friends or in the names of real, unsuspecting companies, according to prosecutors. Court documents list dozens of checks, some for more than $500,000, drafted as early as 1991.Checks were picked up at the tax office, deposited into bank accounts, then distributed to partners in her scheme, prosecutors say. Walters personally approved vouchers for the checks to avoid detection, prosecutors say.The amounts were initially small _ just a few thousand dollars in the late '80s. To boost the amounts and evade detection, Walters recruited people who had business bank accounts, filings show. Walters worked for more than 25 years in the tax office, eventually as a manager in the property tax refund division. Her longevity and a reputation for diligence made her a trusted worker. The city even consulted her when it developed the computerized tax system she is accused of manipulating. "She was known for being professional, very direct, efficient," said Sherryl Hobbs Newman, the former tax office chief, in testimony to the D.C. Council last November. "She was not one of those people you would be questioning their performance."Walters, whose annual salary was $81,000, also gave gifts and loans to co-workers, earning her the nickname "Mother Harriette," according to testimony at the council hearing. FBI search warrants from her Washington home list more than 40 Louis Vuitton handbags among a hoard of clothes, jewelry, shoes and a Faberge egg. She spent $1.4 million at Neiman Marcus, a chain of high-end department stores, court documents say.Friends and co-workers assumed her money came from an inheritance from her father, a banker in the U.S. Virgin Islands, said Samuel Pope, who owned a D.C. beauty salon frequented by Walters in the '80s. Pope said Walters was a kind, generous woman and they became close friends. "She seems to care about what happens with most people and with their problems," he told The Associated Press in an interview two weeks ago. "She seemed to always be in their corner to help out." Last year, Pope was having financial difficulties and Walters called him to report he had a $75,000 tax refund on his Washington home, he said. Pope said he thought the money was legitimate."Why turn down that kind of money?" he asked.However, Pope pleaded guilty Wednesday to conspiracy to commit money laundering and mail fraud. According to prosecutors, Walters let Pope in on the scheme about 20 years ago, and that he took in more than $1.5 mllion by allowing his business bank account to be used for check deposits. He also sought out two property tax refunds from Walters, authorities said. Walters' family appeared to be key to the scheme. A niece is accused of delivering checks and distributing the money. Her brother used his plumbing business for deposits while her nephew, used the account of his cleaning business, court documents state.Most of her accused conspirators didn't ask questions, chose not to believe they were participating in fraud or didn't understand the scale, even as they pocketed hundreds of thousands or millions of dollars from Walters, according to court filings and defense attorneys.Alethia Grooms, a real estate agent from Prince George's County who also did graphic design, would draft fake documents such as check stubs to help cover up the alleged fraud, according to her lawyer, Kevin McCants. She also helped deposit about $600,000 in checks, though McCants said she didn't know how big the scheme was. She made about $200,000, but gambled most of it away with Walters at casinos.Grooms plans to plead guilty to conspiracy to commit fraud, McCants said. Some people held key positions.Walter Jones was a bank worker when Walters came in as a customer in the mid-1990s. The two became friends, and Walters began to use Jones for most of her banking. She offered him gifts of $100, which Jones refused _ but he took the money when the offers went up to $1,000.Jones, who eventually became an assistant manager at a Baltimore Bank of America branch, helped deposit nearly $18 million in checks, and in return, received $366,000, according to his May plea to conspiracy to commit money laundering. The ring included an IRS tax official, Robert Steven, who deposited $9.2 million into the account of a catering business he owned with his wife, documents say. They used the $1.7 million they kept to buy Jaguar cars, a townhouse, and Bahamas trips. His wife faces federal charges and Steven pleaded guilty to federal counts. As for Walters' family, her niece Jayrece Turnbull is still facing charges, and her brother, Richard Walters and nephew, Ricardo Walters, have pleaded guilty to federal charges. Ultimately, the penalty proved greater than what people gained. Many face long prison terms and must repay the full amount of checks they handled, even if they didn't keep all the money.

Harriette Walters is in federal custody on money laundering, bank fraud and other charges

Harriette Walters was generous with her friends.She showered the people she met with cash they used to buy fancy vacations, designer goods, ...

Now-defunct IndyMac Bancorp Inc. is under investigation by the FBI for possible fraud in connection with home loans

Now-defunct IndyMac Bancorp Inc. is under investigation by the FBI for possible fraud in connection with home loans made to risky borrowers, The Associated Press has learned.CBS News' Stephanie Lambidakis confirmed that the FBI is investigating the failed bank and that the probe began before its collapse.The investigation is focused on the company - which was taken over last Friday by the FDIC - and not individuals who ran it, according to a law enforcement official who was not authorized to speak publicly about the investigation. IndyMac Bank's assets were seized by federal regulators after the mortgage lender succumbed to the pressures of tighter credit, tumbling home prices and rising foreclosures.The bank is the largest regulated thrift to fail and the second largest financial institution to close in U.S. history, regulators said. "The FBI currently has 21 investigations related to the sub-prime market industry," FBI spokesman Richard Kolko told CBS News. "We receive information from a variety of sources on a daily basis, and we have an obligation to review each allegation on its merits. Given the volatility of today's subprime market, we have seen an increase in sub-prime related complaints."The Office of Thrift Supervision said it transferred IndyMac's operations to the Federal Deposit Insurance Corporation because it did not think the lender could meet its depositors' demands. FDIC spokesman David Barr could not immediately be reached for comment Wednesday. over the last year, and faced with a cratering housing market, the FBI has opened a wide-ranging probe of companies across the financial services industry, from mortgage lenders to investment banks that bundle home loans into securities sold to investors.Countrywide Financial Corp., the nation's largest mortgage lender, is also under scrutiny. Additionally, two former Bears Stearns managers were indicted last month on conspiracy and securities and wire fraud charges alleging they lied to investors in a hedge fund that tanked last year as the subprime market collapsed. Those charges marked the first criminal charges to arise on Wall Street from the subprime mortgage debacle.

Now-defunct IndyMac Bancorp Inc. is under investigation by the FBI for possible fraud in connection with home loans

Now-defunct IndyMac Bancorp Inc. is under investigation by the FBI for possible fraud in connection with home loans made to risky borrowers,...

Jagmeet Channa pleaded guilty to one count of conspiracy to defraud and another of money laundering after he admitted using colleagues' passwords

Jagmeet Channa, 25, showed no remorse as Judge Geoffrey Rivlin, sitting at the Southwark Crown Court, bemoaned his limited sentencing powers in dealing with the "audacious and outrageous" crime. Channa had previously pleaded guilty to one count of conspiracy to defraud and another of money laundering after he admitted using colleagues' passwords to steal money from a trading account which he then wired to associates in Manchester and Morocco. Today, Judge Rivlin told him: “This was no silly prank. This was a carefully planned and very serious attempt to transfer a fortune in money away and it almost succeeded." Channa worked at the Canary Wharf headquarters of Britain's largest bank for less than a year. In April, the court heard, he sent €60 million from an HSBC trading account to a Societe Generale branch in Casablanca; minutes later, he wired another €30 million to a Barclays branch in Manchester. However, Channa forgot that the account he had raided had to show a zero balance at the end of each day. The massive debit was discovered over the weekend by HSBC employees in Malaysia, who alerted colleagues in London. Both Barclays and Societe Generale were quickly contacted and the money was returned. HSBC estimated it lost about £54,000 in interest while the money was in other accounts. Initially, the employees whose passwords had been used by Channa were arrested and blamed for the crime. But further inquiries exonerated them and led to Channa, who was sacked by the bank. The court heard that Channa had taken the money at the direction of one or more co-conspirators, in exchange for the promise of a handsome cut. His defence lawyer, Peter Corrigan, said: “Because he had the sort of job he did, offers were made to him and he succumbed to temptation." However, Channa's refusal to cooperate with police meant that no other party involved in the crime has yet been identified. Judge Rivlin said: "Others were inolved, perhaps several others, and in the absence of any explanation from you I must assume this was a planned and sophisticated criminal enterprise. "You say you had no idea who these people were or what was going to happen to the money. I regret I cannot accept this statement." The judge told Channa that while his guilty pleas would attract some credit, “the evidence against you is quite overwhelming”. His confession, age, remorse and the fact he had not made a penny from his dishonesty were among the few other things in his favour. Judge Rivlin compared the maximum 10-year sentence available to the 14 years that could be passed for handling and burglary. But he said he must nevertheless "do all that I can to deter those employed by financial institutions from committing such offences". He added: “Where anyone acting in flagrant breach of trust and attempts to steal many millions of pounds, the sentence will inevitably be a very long one." Detective Sergeant Martin Peters said: “This crime is believed to be one of the largest frauds of its kind and it is thanks to the prompt response of the police and the banks that the money was recovered. “The City of London Police takes a robust stance against members of staff that abuse their position and steal from their employer.” The attempted fraud occurred at a sensitive time for the banking sector. It took place just months after Societe Generale, the French bank, alleged that trader Jerome Kerviel lost €4.9 billion (£3.8 billion), while Credit Suisse later revealed that some of its traders had caused pricing errors leading to a $2.85 billion (£1.4 billion) writedown.

Jagmeet Channa pleaded guilty to one count of conspiracy to defraud and another of money laundering after he admitted using colleagues' passwords

Jagmeet Channa, 25, showed no remorse as Judge Geoffrey Rivlin, sitting at the Southwark Crown Court, bemoaned his limited sentencing powers...

number of corporate bankruptcies in Japan rose 11.6 percent in the first half of 2008 with the number of cases related to higher material prices

Bankruptcies for the first six months totalled 6,022, while combined liabilities climbed 17.4 percent to 3.019 trillion yen (28 billion dollars) compared with the same period last year, Teikoku Data Bank said.number of corporate bankruptcies in Japan rose 11.6 percent in the first half of 2008 with the number of cases related to higher material prices hitting a record high, researchers said on Tuesday.June saw 1,065 bankruptcies leaving liabilities of at least 10 million yen each, up 7.1 percent from 994 cases in May, the research firm said in its monthly report.However, combined liabilities in June was down 1.9 percent from the previous month to 471.92 billion yen, but was still 40.3 percent up on the same period last year, it said. Bankruptcies in construction stayed at a high level due to declining orders for public works and rising material prices, the report said.The number of business failures related to the recent surge in raw materials costs reached a record high of 54 cases in June, when oil prices hit a record high of 140 dollars, up 40 percent since early 2008, it added.Corporate failures are expected to continue to increase and the pace accelerate, which will severely impact small and mid-sized firms, the research firm said.Japan has since 2002 been in its longest post-war economic expansion, but that "is about to end," Teikoku Data Bank said."In addition to the construction industry, small retailers are expected to face a period of tough conditions... as recent consumer surveys show household spending expected to decline," it added."Demand from overseas is falling, meaning more manufacturers are expected to go out of business."Top Japanese executives are at their most pessimistic in almost five years as soaring costs, a slowing global economy and a stronger yen pile pressure on profits that are expected to drop this year, the central bank said last week

number of corporate bankruptcies in Japan rose 11.6 percent in the first half of 2008 with the number of cases related to higher material prices

Bankruptcies for the first six months totalled 6,022, while combined liabilities climbed 17.4 percent to 3.019 trillion yen (28 billion doll...

If you're sitting there doing a crossword and you put the paper on the key, boof-boof-boof-boof, it can go right off ... You can just keep trading

Making money makes reputations at investment banks, but the numberless ways in which high-profile traders can lose eye-popping sums is making the case for much sharper focus on the unglamorous role of the risk control units. Despite a regular crop of scandals and errors, from unauthorised positions to "fat-fingered" trades, there is insufficient investment in systems to monitor traders and prevent unacceptable losses, said Giles Nelson, co-founder of trading technology provider Progress Apama. "If you look at surveillance of trading behaviour, it's somewhat seen as a Cinderella," said Nelson. "The real focus is on the exciting stuff, on making money, making deals ... That's where the investment in technology is." Yet the same traders can also lose a bank billions of dollars by circumventing the rules. Trading limits can be broken or errors hidden as unloved risk managers, often equipped with inadequate technology, struggle to impose controls on risk-loving traders. Unauthorised and undetected trading by a junior trader at Societe Generale earlier this year cost the French bank as much as 4.9 billion euros ($7.69 billion). A common mistake is to misprice products or deals, either deliberately, or due to a lack of liquidity or market data, or by the inadvertent typing of an extra zero. Just last week Canada's Toronto-Dominion Bank took a $90 million hit when a trader mispriced financial derivatives, while in June, Wall Street bank Morgan Stanley suspended a London-based credit trader who had overvalued positions by $120 million. In May, Lehman Brothers suspended two London equities traders after identifying a similar problem. THE ALPHA TRADER The problem, said Nelson, is partly because banks are wary of imposing too many controls on traders and so stifling innovation or prompting them to walk to more lax competitors. It is also very difficult to challenge the processes of a division that is a major revenue earner, said Brian Sentance, chief executive of Xenomorph, supplier of data management technologies. Existing safeguards struggle to keep up with the evolution of financial products and transactions and the proliferation of trading venues, and are often run on a series of independent spreadsheets or databases, which inevitably makes a bank vulnerable to errors or malfeasance. Sentance said some of his clients were already updating their risk systems. But banks still need to give risk managers greater power and invest more heavily in data and risk management technologies and procedures, Nelson said. "(Banks realise that) if we don't, then not only are we going to suffer reputationally and the regulators will come down harder on us, but we will lose significant amounts of money eventually," Nelson said. But some circumstances might always prove difficult to guard against. "If you're sitting there doing a crossword and you put the paper on the key, boof-boof-boof-boof, it can go right off ... You can just keep trading and trading and trading," said one London-based trader

If you're sitting there doing a crossword and you put the paper on the key, boof-boof-boof-boof, it can go right off ... You can just keep trading

Making money makes reputations at investment banks, but the numberless ways in which high-profile traders can lose eye-popping sums is makin...

Another Bank failure as Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace

Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace since a key U.S. senator questioned its ability to survive the housing crisis. IndyMac shares sank 38 percent to 44 cents. A collapse of the largest independent, publicly traded U.S. mortgage lender could prove a headache for U.S. regulators since more than $17 billion of its deposits carry federal insurance. Paul Miller, a Friedman, Billings, Ramsey & Co analyst, said shareholders may be wiped out, citing IndyMac's decision to stop most mortgage lending and inability to raise capital. Miller cut his price target for the stock to zero from $1.00. "It's hard to gauge how this situation will resolve itself," said Christopher Wolfe, managing director at Fitch Ratings. "We see a high likelihood of some kind of regulatory intervention occurring, which could result in asset dispositions, or the thrift going into receivership." When asked if the White House was involved in interagency discussions or considering any action, a spokesman responded: "This is an issue for the Fed." Prospect Mortgage, a Northbrook, Illinois-based affiliate of private equity fund Sterling Partners, said late on Tuesday it agreed to buy more than 60 IndyMac retail mortgage branches, which employ 750 people, for an undisclosed price. In a regulatory filing, IndyMac said it still faces "elevated levels of deposit withdrawals." It pointed to comments in late June from Sen. Charles Schumer, who chairs Congress's Joint Economic Committee, raising questions about a possible collapse. Schumer reiterated his concerns on Tuesday. IndyMac said it was working with regulators on a new business plan after losing $896 million in the nine months to March 31. "We are aware of the situation and are working closely with the institution," said a spokesman for the Office of Thrift Supervision, IndyMac's main federal regulator. Big mortgage rivals New Century Financial Corp and American Home Mortgage Investment Corp filed for bankruptcy protection last year. Countrywide Financial Corp, the top U.S. mortgage lender, avoided possible collapse when it was acquired last week by Bank of America Corp. "In short, IndyMac was a junior version of Countrywide," Schumer said in a statement on Tuesday. "IndyMac fueled its growth through unsound lending practices," the New York Democrat continued. "Regulators should consider ways to implement stricter oversight over the lending system so that there isn't another IndyMac." IndyMac reported $17.3 billion of its deposits were insured by the Federal Deposit Insurance Corp. The FDIC has $52.8 billion in its insurance fund to cover bank failures. FDIC Chairman Sheila Bair told the Senate Banking Committee last month that the housing downturn could cause "institutions of greater size than we have seen in the recent past to fail." SEEKING SECURITY IndyMac set plans on Monday to eliminate 3,800 jobs, or 53 percent of its work force, and stop offering most home loans. It also projected a larger loss in the second quarter than the $184.2 million loss it posted for January to March. Regulators concluded the company is not "well-capitalized," and IndyMac has about $1.7 billion of operating liquidity, a regulatory filing showed. A bank is considered well capitalized when it has an equity capital ratio over 6 percent. IndyMac had a ratio of 5.76 percent on March 31. It needs to keep its capital ratio between 4 percent and 6 percent, according to Douglas Landy, a banking partner with law firm Allen & Overy, "in order to remain adequately capitalized and avoid being subject to greater regulatory sanction." U.S. banking law gives regulators increasing power over institutions as their capital levels dwindle over time. IndyMac once specialized in "Alt-A" loans that often don't require borrowers to document income or assets. IndyMac's $77 billion of mortgage loans in 2007 gave it a 3.2 percent market share, ranking ninth nationally, according to newsletter Inside Mortgage Finance. But as rates rose and home prices fell, many borrowers found themselves unable to refinance, and defaults surged. IndyMac shares have skidded 99 percent in the past year, cutting its market value to $44 million from $3.3 billion. HANGING IN Fitch on Tuesday cut its issuer default ratings for IndyMac Bancorp to "CC," a low junk grade, from "B-minus," and for IndyMac Bank to "CCC" from "B." The rating agency also assigned IndyMac's roughly $720 million of uninsured deposits an "average" recovery rating, suggesting uninsured depositors might get 31 percent to 50 percent of their money back. Patricia Lannom, a retiree, said she decided to keep her $100,000 IndyMac certificate of deposit after employees at a branch in Torrance, California, said the funds were FDIC-insured. "I think somebody will buy them if they go under," she said. "What else can I do but hang in there?" FBR's Miller said the stock price might succumb to falling home prices, rising credit losses, rating agency downgrades, and IndyMac's decision to curb lending. "We do not believe that there is any value left for common shareholders," he wrote. IndyMac faces several shareholder lawsuits that accuse it of misleading investors about its financial condition. The company said it plans to keep offering reverse mortgages to older borrowers through its Financial Freedom unit, and operate 33 branches in Southern California. (Additional reporting by Dena Aubin and Martha Graybow in New York, and Rachelle Younglai in Washington, D.C.; Editing by Braden Reddall abd Andre Grenon)

Another Bank failure as Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace

Mortgage lender IndyMac Bancorp Inc said on Tuesday depositors had been withdrawing cash at an "elevated" pace since a key U.S. se...

Fitch indicated it may move to cut its credit rating on Merrill’s long-term debt

Merrill Lynch (MER) has garnered the nod as an outlier among investment banks in terms of credit worthiness. But it’s a dubious distinction, at best. Ratings agency Fitch indicated it may move to cut its credit rating on Merrill’s long-term debt - a prospect it basically erased for the other three major investment banks. Citing the scope of the long-term credit that comes due next year, Fitch placed Merrill’s long-term issuer default ratings on rating watch with a negative bias, a move that often presages an upcoming cut in the credit rating itself. Fitch expressed pessimism about the prospects for Merrill’s fixed-income, currency and commodity operations, which it said could off-set strength in areas like Merrill’s retail brokerage operations. The rating agency also said that it anticipated further write-downs from Merrill’s exposure to its residential mortgage and monoline insurance exposure, which diminish expectations for a sustainable return to core profitability. Merrill shares traded down nearly 3%, though - to be fair - even the investment banks that weren’t put on rating watch suffered declines in Wednesday’s trading.

Fitch indicated it may move to cut its credit rating on Merrill’s long-term debt

Merrill Lynch (MER) has garnered the nod as an outlier among investment banks in terms of credit worthiness. But it’s a dubious distinction,...

Bank failures are extremely rare, savers might want to bear in mind that the Government will only underwrite the first £35,000 of your savings in any

Halifax said house prices had fallen by more than 6 per cent during the last year, having fallen 2 per cent in the last month. The average property now costs around £180,000. Mortgage rates have already hit their highest level for eight years, according to the Bank of England. The average rate on a two-year fixed rate mortgage has risen from 6.26 per cent to 6.63 per cent. The pain is set to continue as lenders tighten their lending criteria. For example, Alliance & Leicester still allows homeowners to opt for a term of 40 years on their mortgages but affordability will be calculated as if you were paying it back over 25 years. Ray Boulger of mortgage brokers John Charcol, said: "Today's Monetary Policy Committee (M per cent ) decision to keep the bank rate unchanged at 5 per cent was widely expected. With increasingly bad economic news almost daily from most sectors of the UK economy a rate cut is badly needed to help restore some confidence but the expectation of further increases the inflation is a major constraint on the MPC. "However, the dire economic news probably means that the MPC is no longer seriously considering increasing bank rate and so the main question is how long will we have to wait for the next cut. The MPC will be watching the price of oil and other commodities very closely." Jonathan Cornell, of mortgage brokers Hamptons Mortgages, said the Bank of England had been under tremendous pressure from two sides. "On one side inflation at 3.3 per cent is significantly above the bank's 2 per cent target and the Governor had to write an explanation letter to the Chancellor on June 16," he said."On the other side, a chronic lack of mortgage funding has led to house prices falling month on month. The majority of the inflationary pressure is linked to the rising price of oil, the price of other energy and food." Richard Cotton, senior partner at estate agents Cluttons, said: "The bank's decision to maintain rates suggests that it is continuing its laissez-faire attitude of the last two months, and failing to take positive action to deal with the current downturn in the property market and the wider economy. "The property industry needs to hear a positive message from the bank, that it understands the difficulties in the industry and is doing something about it. "Maintaining rates at 5 per cent will not give consumers any confidence in the bank's ability to manage this crisis, which will result in a worsening of current conditions in the property market and wider economy." But savers should be able to benefit with rates at a seven-year high as high street banks which are struggling to raise funds on the money markets try to attract large inflows of cash. As a rule, the highest paying accounts are run online as banks without high street branches have fewer overheads. Those customers who can afford to lock up their money for the minimum of a year will also receive preferential rates. Savers should be aware however that while bank failures are extremely rare, savers might want to bear in mind that the Government will only underwrite the first £35,000 of your savings in any one bank. This limit often applies to all the different brands operated by one bank.

Bank failures are extremely rare, savers might want to bear in mind that the Government will only underwrite the first £35,000 of your savings in any

Halifax said house prices had fallen by more than 6 per cent during the last year, having fallen 2 per cent in the last month. The average p...

Baninter US$2.5 billion fraud, which led to the world’s biggest bank collapse per capita

after five years the Supreme Court put an end to the proceedings that led to bank fraud convictions in the Baninter case, when it upheld the...

IndyMac is the largest regulated thrift to fail and the second-largest financial institution to close in U.S. history

New chief executive of IndyMac Bancorp, brought in by the government to manage the failed bank, said new lending standards should prevent the kind of problems that have brought down credit markets.John Bovenzi, the chief operating officer of the Federal Deposit Insurance Corp., reassured consumers that bank failures have been rare in the past, and that if more banks do fail, the government has enough in reserve "I think the important point to make is that, historically, only a very small percentage of the banks on our problem banks list ever failed," he said on CNN late Sunday. "While there are 90 banks on the list, there would be no expectation that 90 of those banks would fail."Bovenzi took the helm of what will be IndyMac Federal Bank when the government stepped in late Friday afternoon to save the struggling institution.The Office of Thrift Supervision transferred control of IndyMac to the FDIC because it did not think the lender could meet its depositors' demands. IndyMac is the largest regulated thrift to fail and the second-largest financial institution to close in U.S. history, regulators said after taking control of the bank.As of March 31, IndyMac had $19.06 billion in total deposits.Bovenzi reminded consumers that all accounts worth $100,000 and less are automatically insured by the FDIC, which has $53 billion in insurance funds. And he noted that there are ways to structure accounts so that more than $100,000 is covered."If there are other bank failures in the coming weeks, I think the same message, if your accounts are under $100,000, you have absolutely nothing to worry about," he said. "You can still find ways to protect more if you like."Beyond $53 billion, he said the FDIC would have go to other banks to raise more money, adding that in that case, consumers could expect some of that to be passed on in fees."Well, obviously it's a difficult time and there were certainly institutions that made loans that shouldn't have been made," he said. "There are standards being put out, hopefully, at institutions with better underwriting going forward so that this problem doesn't repeat itself."

IndyMac is the largest regulated thrift to fail and the second-largest financial institution to close in U.S. history

New chief executive of IndyMac Bancorp, brought in by the government to manage the failed bank, said new lending standards should prevent th...

U.S. regulators seized California savings and loan company IndyMac Bank and its $32 billion in assets.

Investors are scanning the banking industry for signs of more trouble after the biggest U.S. bank failure in more than two decades. Last wee...

Rachel Lottering believed to be on the run in Pretoria, allegedly duped people into believing that she had inherited R600-million.

Rachel Lottering, 37, believed to be on the run in Pretoria, allegedly duped people into believing that she had inherited R600-million.Bellville specialised commercial crime court on Monday authorised a warrant for the arrest of a woman alleged to have obtained loans by fraudulent means.She was to have gone on trial on Monday before Magistrate Amrith Chabilall on four counts of fraud, but was absent when the case was called.Facing the same charges were her husband, Jacob, of George in the Southern Cape, and a friend of the couple, Johannes Jantjies.The wife's absence caused the withdrawal of her privately funded attorney, William van der Schyff, who told the court she had not met her financial commitments towards him, nor had he been able to consult her.Her bail was initially fixed at R5 000, but was later reduced to R2 000.According to her husband, she was "somewhere in Pretoria", Van der Schyff said.He added: "Last Saturday, she informed me that she had no money to come down to Cape Town."On the first charge, prosecutor Jacques Smith alleges she fraudulently induced George businessman Werner Kruger to advance her R257 409 whilst her non-existent inheritance was being finalised.Her inheritance was to be invested in his business, Smith alleges.The second charge alleges that she duped Rodney Kemp, of Belhar on the Cape Flats, to resign his job and spend R43 000 on premises and office furniture for a company that he was to launch on her behalf.He did this on her false pretence that she was to invest R15-million of her inheritance in the business, and that he, his wife Merle, and Lottering and her husband would be the directors.The third charge alleges that she similarly induced Southern Cape businessman Andries George to lend her R33 000 while she waited for the finalisation of a R700-million inheritance - not R600-million as with the others. On the fourth charge, she is alleged to have similarly induced Belhar businessman to lend her R15 000 while she waited for her inheritance.The charge sheet did not specify what part her husband or Jantjies had in the alleged scam. The matter case was postponed to July 28, when the arrest warrant is to be executed should she again fail to appear in court.

Rachel Lottering believed to be on the run in Pretoria, allegedly duped people into believing that she had inherited R600-million.

Rachel Lottering, 37, believed to be on the run in Pretoria, allegedly duped people into believing that she had inherited R600-million.Bellv...

attorney Richard "Dickie" Scruggs was sentenced to five years in prison for conspiring to bribe a judge in front of whom he had a pending case

attorney Richard "Dickie" Scruggs, a high profile plaintiff personal injury attorney from Mississippi, was sentenced to five years in prison for conspiring to bribe a judge in front of whom he had a pending case.Mr. Scruggs and his firm made its reputation in suits against tobacco and asbestos companies and represented Hurricane Katrina victims in actions against insurers that had denied policy holders' claims. In an attorney fee dispute case arising out of the Katrina cases, Mr. Scruggs and his firm found themselves defendants. According to the indictment against Mr. Scruggs, he conspired to bribe the trial court judge in the fee dispute case to enter an order sending the claim to binding arbitration. Scruggs felt he would pay less by having an arbitration panel, rather than a jury, determine what he owed the attorney who sued him over the division of the Katrina case legal fees.All attempts to subvert the legal process are reprehensible, and must be punished. Not surprisingly, Mr. Scruggs case has been reported by the "tort reform" folks with great rejoicing. Mr. Dan Pero, the dean of reasoned, objective, in-depth analysis, has written a blog piece about it, filed in his "trial lawyer" category, reserved for examples of conduct of which he does not approve (very broadly defined) by trial attorneys. (Exclusively defined as those attorneys representing plaintiffs in personal injury actions. Apparently the American Justice Partnership cannot envision any possible misconduct by attorneys representing insurance companies or corporations.) By the way, the "Tort Reform" and "Trial Lawyer" categories of Mr. Pero's blog are intended to show why the country needs more rules to curb the greed of injury victims and those who represent them. Interestingly, there is no category entitled "Corporate Greed". I mention this because about the same time as Mr. Scruggs was sentenced, the most recent in a series of federal indictments were handed down in the continuing FBI probe of mortgage fraud across the nation (Mortgage Probe Results in Six Indictments). Corruption and lax business practice in the pursuit of profits in the mortgage and banking industries have helped pave the nation's path to recession. Yet, there is not one reference to such greed and such criminal activity in the American Justice Partnership's American Courthouse blog. Search if you like. I have. Perhaps I should consult the Michigan Supreme Court's Library of Dictionaries for the proper definition of "justice". What Mr. Pero and the AJP fail to recognize is that, in reviewing the Scruggs case, the "tort reformers" and the various Chambers of Commerce have more in common with Dickie Scruggs than they would care to admit. Mr. Scruggs, the defendant in the fee dispute, wanted the judge to order the case into arbitration, figuring he would do better there than in front of a jury. I assume he felt that if his actions were reviewed by a jury of average citizens, that the facts might yield a result not in his best financial interest. So, he tried to engage in a little private "tort reform" of his own, by bribing the judge to take the case away from the jury.

attorney Richard "Dickie" Scruggs was sentenced to five years in prison for conspiring to bribe a judge in front of whom he had a pending case

attorney Richard "Dickie" Scruggs, a high profile plaintiff personal injury attorney from Mississippi, was sentenced to five years...

Charges Adelphia founder John Rigas and his son, Timothy, faced in Pennsylvania are separate from the fraud charges on which they were prosecuted in

federal judge has refused to dismiss charges of conspiracy and tax evasion against the imprisoned founder of Adelphia Communications Corp. and his son, ruling the charges don't amount to double jeopardy. The charges Adelphia founder John Rigas and his son, Timothy, faced in Pennsylvania are separate from the fraud charges on which they were prosecuted in New York, the judge ruled Friday."In the New York action, the Rigases were charged with agreeing to conceal from investors, analysts and lenders the failing financial condition of Adelphia," District Judge John E. Jones III wrote. "In this action, the Rigases are charged with agreeing to avoid paying income taxes. These two different objectives mark two different conspiracies."John Rigas is serving 12 years in prison and Timothy Rigas, once Adelphia's chief financial officer, is serving 17 years following their 2004 New York convictions on charges including conspiracy, bank fraud and securities fraud.Prosecutors said the Rigases essentially used Adelphia as their personal piggy bank. Once the nation's fifth-biggest cable company, Adelphia collapsed into bankruptcy in 2002.The Rigases were indicted in Pennsylvania in 2005 on federal charges of conspiracy and tax evasion. Prosecutors claim that they obtained about $1.9 billion in Adelphia funds for personal use and failed to report it as income, thus defrauding the government of $300 million in taxes. The Rigases argued that their acquittal on wire fraud and conspiracy charges in New York means they did not scheme to defraud the company by diverting funds for personal use.In his 39-page decision, Jones wrote that while the New York jury "concluded they did not engage in a scheme to defraud Adelphia, this conclusion does not establish that they did not receive funds from the company for personal use."

Charges Adelphia founder John Rigas and his son, Timothy, faced in Pennsylvania are separate from the fraud charges on which they were prosecuted in

federal judge has refused to dismiss charges of conspiracy and tax evasion against the imprisoned founder of Adelphia Communications Corp. a...

Mark Thatcher is said to be looking for a house to buy in Guernsey

Mark Thatcher is said to be looking for a house to buy in Guernsey, believing the Channel Islands might shelter him from the vengeful ruler of a small African state who is alleged to eat the brains and testicles of his enemies. But if you think that is an unenviable situation for Baroness Thatcher's wayward son, consider the plight of his erstwhile friend Simon Mann, who is in one of the ruler's dungeons. It is no place for an Old Etonian and former SAS officer. Both men have admitted a role in the botched 2004 plot to overthrow President Teodoro Obiang Nguema of Equatorial Guinea, once a malarial backwater which is now Africa's third largest oil producer. But Sir Mark told a South African court his participation was "unwitting". Mann, who has just been sentenced to 34 years in Malabo, Equatorial Guinea's capital, claims it was a good deal more important: in fact, he says, Sir Mark was on the "management team" giving the orders to the ex-soldier, whose own part was much less significant, despite being caught in Zimbabwe on his way to Malabo with a shipment of arms and a planeload of mercenaries.So far, so confusing. But then last week, Ely Calil, the London-based oil trader named by Mann as the "cardinal of the plot", broke his silence. For four years he flatly denied any involvement, but on Tuesday he told the Daily Telegraph that he supported only "democratic change" in Equatorial Guinea, and had financed plans by Severo Moto, an exiled opponent of President Obiang, to return. "There was no coup plot," he said, and Sir Mark had "absolutely nothing" to do with it. Mann and his mercenaries were simply hired to protect Moto. Last week, Calil was negotiating with Channel 4 News to put his side of the story on television, but his ground rules for an interview were said to be too restrictive for the broadcaster. All three men in this tale are millionaires with "splodges of wonga", to use Mann's words. The odd thing is that he seems to be the most cheerful of them. Despite being in Malabo's Black Beach prison, which supposedly floods at high tide, Mann says it is better than his last jail, in Zimbabwe. He has a proper bed and meals are sent in from a hotel. He is reported to have told his bank in Guernsey – that place again – to send him his records, hoping to use them to gain leniency. Sir Mark, who has a considerable fortune from various business deals, also banks in the Channel Islands. But if he is seeking to move from his present base, a heavily fortified mansion in southern Spain, it is not to be nearer his money. Though he is safe from Equatorial Guinea's attempts to extradite him, he is said to fear being spirited away illegally, and believes a kidnap squad would be more conspicuous in Guernsey. However, his choice of bolt-holes is limited since his criminal conviction in South Africa. The US will not have him, nor will Monaco or Switzerland – so this small island seems his best bet.

Mark Thatcher is said to be looking for a house to buy in Guernsey

Mark Thatcher is said to be looking for a house to buy in Guernsey, believing the Channel Islands might shelter him from the vengeful ruler ...

plot to steal £72m from inside the London headquarters of one of the world's largest companies, the HSBC banking group

Jagmeet Channa, a charity volunteer from a middle-class family, who had no previous criminal convictions, was sentenced last week to nine years in prison for attempting to steal the cash from his employers. Yet the mysterious syndicate that conspired with the lowly bank clerk remain at large. Police fear they will strike again, but Channa refuses to utter a word, let alone turn supergrass<a href="http://2.bp.blogspot.com/_ANNSRoaDZro/SHlOT7hjQTI/AAAAAAAACgo/GH90NCatRKY/s1600-h/460x276.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5222291347215696178" src="http://2.bp.blogspot.com/_ANNSRoaDZro/SHlOT7hjQTI/AAAAAAAACgo/GH90NCatRKY/s400/460x276.jpg" style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;" /></a> Jagmeet Channa may name the shadowy figures behind the biggest attempted fraud in British history. What is more likely is that the 25-year-old will maintain his vow of silence inside his prison cell, preserving his position as the only person caught after a plot to steal £72m from inside the London headquarters of one of the world's largest companies, the HSBC banking group.'He won't say who he was involved with. He won't say how it all happened, who else there was. He is an intelligent guy, has a degree in economics, comes from a very respectable family and has no previous convictions. He knew precisely what he was doing when conspiring to fraud,' said David Levy, assistant director of the Crown Prosecution Service fraud unit and the man who took the decision to charge the young banker.It was shortly after 9am on Friday, 18 April, while working at HSBC's Canary Wharf headquarters, that Channa authorised two seemingly straightforward transactions. But they were made using passwords stolen from colleagues. No one paid much attention - the new clerk from Essex was considered a safe pair of hands. Channa had arrived 10 months earlier on a short-term contract, but his diligence quickly secured a staff job. Yet the ambitions of the bright new recruit were less transparent. Unknown to colleagues, their studious, softly spoken colleague from Ilford was the inside man for a syndicate looking to orchestrate a crime that would have rocked public confidence in the banking system during a period of acute economic uncertainty. That spring morning, Channa wired €60m (£48m) to an account at French bank Société Générale in Casablanca, Morocco, then moments later, he despatched €30m to a branch of Barclays in Manchester. 'It was totally audacious, and said to be the biggest fraud of its kind in the UK, certainly the biggest we've handled. It's probably as big as you'll get in one hit in two directions,' said Levy. As the bank's employees filed home that night, Channa behaved as if nothing had happened. Typically, he spent the weekend at the suburban family home. Yet beneath his calm exterior, Channa was euphoric. Transcripts of telephone calls made from his HSBC landline that Friday reveal a series of calls informing several characters that the fraud was a triumph. Attempts to uncover their identities have proved fruitless because they were using pay-as-you-go handsets. Less clear is what Channa intended to do with his riches. Subsequent investigations found no evidence of plans to flee the country, nor ostentatious spending sprees. The young banker appeared to have planned to carry on living with his father and two brothers in their two-storey terraced house in Essex, where police found computer print-outs of the fraudulent transactions and a memory drive holding information on his colleagues' stolen identities. Channa had pulled off the biggest crime in British history in terms of the amount of cash stolen - more than 27 times that taken during the Great Train Robbery in 1963 and almost £20m more than the used notes stolen in 2006 during an armed raid on a Kent cash depot. Then, just after lunchtime on the Sunday, Channa's plan fell apart. Banking security officials 9,000 miles away in Malaysia had noted a double transaction, prompting 'cause for concern'. Channa had used a global financial holding account where vast amounts are paid in then removed. At the close of daily trading, the account should register zero, but Channa had inexplicably forgotten to change it and his holding account was showing a massive debt. It was an elementary error that, if Channa had avoided it, might have allowed him to pull off his record-breaking crime. Channa's decision to execute the crime on a Friday had compounded his mistake. With trading frozen over weekends, security officials find it much easier to detect anomalies. Had Channa committed the fraud during the frenetic trading of the working week, his scam may have remained undetected for long enough to allow his partners to empty the £72m from the accounts in Manchester and Morocco. Levy said: 'The reality is that the money had gone, that is the incredible thing. The theft had taken place, fulfilled in its entirety.' The £72m was frozen and returned to HSBC. Meanwhile, City of London police arrested, but quickly released, the two colleagues whose identities Channa had stolen. Analysis of the CCTV cameras on the 43rd floor of HSBC's headquarters confirmed that only Channa could be responsible. Levy added: 'He had cheated the system. He had to use deceptive methods to steal those IDs and use them to cover his tracks.' Five days after committing the transaction, Channa was arrested. No explanation was offered, in fact Channa refused to utter a word. He had taken the extraordinary decision to protect his accomplices despite knowing his sentence could be slashed if he named them. 'The fact is the guy just clammed; he didn't help himself. But the question is: why did he clam?' said Levy. The following day Channa was charged with conspiracy to defraud, money laundering and abuse of trust. Within a week of committing the fraud, he was facing jail. Yet for the police and international banks, the inquest had only just begun. Even now, officers have no idea for how long the crime was being planned. Was Channa a 'sleeper', deliberately planted inside HSBC by an international criminal syndicate he had met before joining the bank? Was he deliberately targeted by organised fraudsters? What does seem clear is that his family and friends had no idea of his double life. Some believe he was coerced or threatened into facilitating the crime. Certainly his actions appear out of character. 'He was always a good boy and knew what he wanted to do with his life,' said a close family friend, who requested anonymity, outside the family home last week. He was at a loss to explain why Channa had suddenly decided to sacrifice his career and future. 'He fucking hates [prison]. He's surrounded by the worst criminals. They're in for violent crimes. His wasn't a violent offence. It's not right.' Channa had, after all, toiled throughout his life to realise his dream of forging a career in finance. After leaving Seven Kings High School, Ilford, with four A-levels, Channa went to the University of Hertfordshire, funding his education through part-time positions as a shopfloor assistant. 'He got a glowing reference from Seven Kings. His CV is amazing ,' said the family member. Friends point to his charity commitments as evidence of good character. Months before his arrest, Channa had completed a 30-mile walk for Oxfam and finished the Nike 10K run. The one notable tragedy in his life was the suicide of his mother four years ago. In light of any other explanation, his family are convinced that Channa had been forced to commit the fraud. The family member added: 'I think there are a lot more people involved. It wasn't something he did out of choice. He would have known something like this would come back to haunt him. I can't say whether he was threatened or not. The police might think that they've found their man, but they haven't.' In particular, mystery surrounds the Moroccan link. His family say Channa has never been to the north African country and has no connections there. Detectives, meanwhile, believe that deciphering who set up the account in Casablanca holds the key to the mystery but, despite British investigators requesting information from the Moroccan authorities, no assistance has been forthcoming. Officers are adamant, however, that whoever was behind the Casablanca connection knew what they were doing; Channa appears to have been briefed meticulously on what to do. 'He wasn't the only person, but clearly he was going to benefit, get a cut from it. He had a lot to gain and the bank had an awful lot to lose,' said Levy. 'The case is not closed. Channa knows what it's all about, but he's not going to tell us.'

plot to steal £72m from inside the London headquarters of one of the world's largest companies, the HSBC banking group

Jagmeet Channa, a charity volunteer from a middle-class family, who had no previous criminal convictions, was sentenced last week to nine ye...

Ten people have been charged with mortgage fraud based on an investigation of four separate cases in northeast Ohio.

Ten people have been charged with mortgage fraud based on an investigation of four separate cases in northeast Ohio.Cuyahoga County Prosecut...

Bellevue mortgage company have been indicted on fraud charges for allegedly using straw buyers to purchase dozens of homes at inflated prices

Two former employees at a Bellevue mortgage company have been indicted on fraud charges for allegedly using straw buyers to purchase dozens of homes at inflated prices and siphoning off the extra money for themselves.The federal indictment alleges Christopher Brooks and Amani Moss pocketed at least $1.6 million.The indictment says they obtained more than $27 million in fraudulent loans for the purchases of at least 54 homes beginning in 2005.Prosecutors allege they recruited straw buyers, who would allow the men to falsify loan papers for them and then purchase a house at a price above its actual value.The U.S. attorney's office says the homeowners would rebate the extra money to a company controlled by Brooks and Moss. Later, the buyers would default on the loans, leaving lenders with significant losses.The difference between the inflated price and the actual purchase price of the homes ranged from $30,000 to $778,000 per home.If convicted, Brooks and Moss face up to 20 years in prison and a fine of up to $250,000.Six people have been indicted in Western Washington. Four of them - Mustafa Khosraw, Robert Berandt, Isaac Palmer and Zachary Namie - appeared in federal court last month.

Bellevue mortgage company have been indicted on fraud charges for allegedly using straw buyers to purchase dozens of homes at inflated prices

Two former employees at a Bellevue mortgage company have been indicted on fraud charges for allegedly using straw buyers to purchase dozens ...

Policy Sharking fraudulent schemes as are alleged in lawsuits involving at least $3.5 billion dollars in life insurance policies

Responding to the discovery of an elaborate conspiracy to defraud millions of dollars from senior insurance policyholders, Mark E. Ross, Chairman of the Mark Ross Group of Companies, today announced the formation of the American Seniors Financial Integrity Trust, a non profit association to protect seniors from such “Policy Sharking” and related fraudulent schemes as are alleged in lawsuits involving at least $3.5 billion dollars in life insurance policies. The “Trust” will seek to gather seniors who are prospectively or presently affected by this scheme and provide for the proper disposition of their assets through referrals to a panel of advisors approved by a Committee on Ethical Standards and through the referral of suspected cases of fraud to prosecutors. Mr. Ross described the discovery of criminal “Policy Sharking” fraud in a statement to prospective ASFIT members as follows:On “Policy Sharking”, Bid Rigging and the Theft of Seniors’ Assets as Discovered in Current Cases in Litigation.A statement regarding the discovery of bid fabrication by certain defendants in Jenkins vs. Mutual Credit Corporation involving the theft of more than $ 3.5 BILLION of life insurance policies by a conspiracy involving XE Capital Management KBC Financial Products, a subsidiary of the Belgian banking conglomerate, Mutual Credit Corporation, Sierra Life Solutions, Michael Brown, Anthony Jacobson, A.J. Meade, David Doten et. al.After balancing the relative importance permitting certain information to surface through formal court proceedings against the public’s need to know to prevent ever increasing damage to innocent senior citizens, we have determined that the public’s need to know and the market’s need for integrity outweighs any limited disadvantage that the defendant firms and their principals, might experience from a brief acceleration of this disclosure. We hold that a conspiracy of several firms, including a major international bank, a hedge fund and others, including those mentioned above, as well as certain facilitating professional entities, have engaged in a widespread, premeditated “Policy Sharking” enterprise involving fraud, coercion, deceit and extreme abuse of elders, in order to secure a $200 million profit for the principals of XE Capital Management of New York and their conspirator/partners. Through the sale of notes representing premium loans secured by approximately $3.6 billion of life insurance policies to KBC Financial, an indirect wholly owned subsidiary of KBC of Belgium, a $600 billion bank, senior policyholders have had their assets “sharked” and stolen.These policy loans had a unique feature. The interest rates could not be determined except by reference to the fair market value of the underlying policies at the 24 month maturity date of the loans. While there was an objective protocol set forth in the Notes, this would have produced a fair and true result as envisioned when the policies were initially sold to the public. As this honest and equitable result would not have produced the most advantageous result and profit to either the seller (XE Capital, Brown, Jacobson, Meade and certain family trusts) or to the buyer (KBC Financial Products), we charge that these conspirators masterminded a complex, duplicitous scheme (which we have defined and submitted to several legislative committees and regulatory officials to adopt as terminology, “Policy Sharking”) intended to seize all of the policies that comprise the two corporeal entities (i.e., Special Purpose Vehicles) that hold all of the Notes and eventually the policies when they are wrongfully taken from their rightful owners.The stakes are enormous and the potential impact on the integrity and public perception of the secondary market for life insurance and, by inference, the entire life insurance marketplace is potentially devastating. It is essential that a conspiracy of this breadth and magnitude be uncovered as quickly as possible by ethical market participants committed to this marketplace on a permanent basis. We have rejected an ostrich approach, i.e. awaiting the slower but inevitable hands of justice intervening while hundreds of our nation’s seniors are seriously harmed. We believe that we must show that the industry consists, for the most part, of honest, creative, ethical professionals attempting to provide value to the public and to conduct themselves with principle and integrity.The criminal action is focused within the definition of each policy’s contingent interest calculation. The program starts with a loan to allow seniors to acquire life insurance without posting any collateral, in addition to the life policy itself. The loan was for generally a two year period at which time the policyholder/borrower is told that he can pay off the loan and keep the policy. As an additional inducement to enter this arrangement with MCC/Sierra, the California licensed premium finance entity arranged to advance additional funds equal to 1%, 2% or 3% of the policy’s face amount (e.g. $ 200,000 per $10 million of the policy which, as a non-recourse loan, would never need to be repaid. The interest on these loans is divided into two baskets: 1a. Fixed interest equal to 10% of the amount loaned annual, 1b. Plus a onetime origination fee of 5% of the amount borrowed 2. PLUS, a contingent interest. The contingent interest is a definitive number that cannot be determined until the loan maturity date since the contingent interest is defined as the fair market value of the policy on such date less the financial interest on the same date, but in no event to exceed 10% of the face amount of the policy. Please note that the 10% is a MAXIMUM number that is only expected to be achieved in a select few odd cases, often as the result of a serious morbidity event or a degradation in one’s health status in the 24 months since policy issuance. To prevent any ambiguity or subjectivity in the calculation of this contingent interest, it was necessary to adopt a uniform all purpose protocol that would yield the result in each case with total equilibrium between the parties without the possibility of requiring any negotiation or court intervention in each case. This was critical in the marketing of these policies because it would not have been possible to sell an arrangement where the interest determination (the key to whether a policyholder truly has control and dominion of a policy under these circumstances) was left to the judgment of the asymmetrically superior party (the MCC Group and its backers) or where it depended upon any kind of negotiation (negotiation being implausible when the bargaining powers are at such disequilibrium levels). Therefore, it was a core and essential element in the Notes (as written and hence contracts of adhesion by the lender or MCC) as well as in the Insurable Interest Opinion (written by the law firm of De Castro West et al ) that the protocol for determining the fair market value be included and be inviolable. The protocol was perfectly straightforward and not open to any misinterpretation. Each trust was required to have two trustees, an investment trustee, appointed by the insured, often a family member or trusted friend, who had most of the traditional trustee’s powers and the administrative trustee, who was recommended by MCC and in all cases was accepted by the insured. The primary trustee was David Doten, a former mid level trust officer who had earned no more than approximately $50,000 in any given year before being selected for this role by Mike Brown and Anthony Jacobson. We believe that Mr. Doten’s earnings increased to over $1 million as a result of this “selection for the lottery”. It is beyond doubt that his loyalties were to the program sponsors who included and recommended him for this role (as was the case with the two other administrative trustees). Their job was only to sign forms and to arrange for the filing of trust tax returns. Instead, as part of the conspiracy, they were “ordered” to assume a much larger role to the substantial detriment of the trust and its beneficiaries to whom they owed an undivided loyalty and to the benefit of their sponsors, MCC and its backers. The protocol was simple. The investment trustee, generally aided by an independent broker would obtain bids from two licensed life settlement providers (they did not need to be the highest bids) and submit them to the lender. If the lender did not accept the higher of the two bids, the lender could require that the investment trustee (not the lender) seek a valuation from Coventry First, the named valuator in the documents. Only if Coventry will not provide the service, shall the investment trustee seek to find another Valuator acceptable to the lender. Unknown to any of the borrowers, the XE Capital Group and the Michael Brown and Anthony Jacobson Group that owned all of the Notes that represented the financing of these policies sold the companies (the Special Purpose Vehicles or SPVs) that held all of these Notes to KBC Financial Products, a subsidiary of a huge Belgian financial conglomerate. In so doing, the sellers realized a profit exceeding $200 million. However, they did so dishonestly. In order to perpetrate the required fraud upon the senior citizen policyholder/borrowers that comprised this portfolio, they made pre-arrangements to subsidize their large profit by manipulating the policy fair market valuations and “stole” much of the value that belonged to the real owners and transferred it to the buyers in exchange for their $200 million profit. They accomplished this egregious fraud upon the elderly seniors who were, in general, the individual lives that had been insured and who were included in this portfolio. In order to create this massive and premeditated fraud, MCC and KBC, perhaps with the assistance of their professional advisors and facilitators, entered into a new and secret document called the Servicing and Management Agreement of 2006 (“The SMA”) which required that MCC service all of the loans in the portfolio after the sale of such loans to KBC in a fraudulent and dishonest manner. It has taken us almost two years and millions of dollars (as well as multiple threats to ourselves and to the senior citizens who stood up for themselves, Harry and Anna Jenkins and Donald L. Kueltzo who should be considered the real heroes of this affair) to “discover” this document and the files of the individual borrowers to begin to prove our theories of the case. What this document indicated and what the files confirmed were nothing short of incredible! What is even more incredible will follow next! The SMA completely changed the protocol by which the contingent interest would be determined and did so in a manner designed to cause the buyer of the notes to always win and the clients to always lose. In fact, that is precisely what happened! the new language in the SMA required that a borrower that wished to pay off his/her loan now had to produce two purchase bids from licensed providers that were acceptable to KBC (the document actually names the SPV holders of the notes but they are completely dominated by KBC so it is essentially the same thing) AS GOOD VALUATIONS. Thus, the NOTES have been unilaterally and improperly modified to eliminate the concept of the valuator (Coventry First) and to subject the purchase bids to the condition that they be acceptable to KBC as good valuations. First, there was never a requirement that one succeeds in obtaining permission from KBC and, second, it is IMPOSSIBLE to ever have a purchase bid also be a good VALUATION. As any first year law student can tell you, a bid and a valuation are different commercial documents and can never substitute for each other. As a result, the author of this portion of the SMA very cleverly eliminated every protection that had been built into the system for the senior Citizens and instead built a guaranteed contractual machine to commit fraud in exchange for money.What has been the score after the first 314 loan maturities? As required in the SMA, and as is proscribed or not permitted in the Notes, MCC has demanded in writing from each and every borrower that each must pay the full 10% Maximum contingent Interest in every single case. Of course, this is a mathematical impossibility. In addition, of the first 314 cases, 309 (all but 5 cases) have relinquished their policies to the lenders rather than fight in court. WHY? As an example, when we were asked to represent the Jenkins family, we followed the Note with high fidelity and determined, with a Coventry valuation, that NO contingent interest was due. Despite the requirement that the lender then accept our check in full payment of the debt and return the policy to its rightful owner, MCC “decided” that the bidding was not bona fide and neither was the valuation. This is because they claimed that they had procured purchase bids of 22% and 24.5% of face amount whereas our bids and valuations were all in the approximate 7%-8% of face amount area and therefore no contingent interest was due. It should be noted that for each and every one of these borrowers who relinquishes his/her policy back to these people will have to pay a tax on this 10% or $1 million per $10 million policy (thus, in the case of Mr. Kueltzo he is facing the payment of tax on an additional $4 million of taxable income as a result of this fraud.And now, to justify their argument that they can reject the pricing of contingent interest differently than Mr. Jenkins submitted in complete accord with the notes, MCC/KBC claimed to have purchase bids of 22% and 24.5%. We have studied the depositions of these two well known settlement firms and each admits that they were requested to do a “favor” for Mr. Jacobson in exchange for the promise of large amounts of new settlement business—which never materialized—and prepare “fabricated” term sheets for MCC to utilize to support their outrageous claims. They settlement firms did not craft their own bids—they were not prepared to close these cases—they did not have medical files or life expectancies or insurance policy data or illustrations or even the most basic pre-requisite, a verification of coverage from the insurer.In other words, these were fraudulent purchase bids, acquired and submitted to defraud our clients, advisors to them and the honorable court. We are preparing to prove this in court and in any other forum where this mission will take us. We have sworn an oath to assist these elderly people who have been abused, intimidated and financially assaulted. As a result of this incredible and callous case, we announce the establishment of the ASFIT, the American Senior Financial Integrity Trust, which will provide research and education training to American seniors and, where necessary, will protect and defend seniors from the demoralizing and dehumanizing degradations of financial fraud perpetrated by unscrupulous and morally and ethically challenged individuals.

Policy Sharking fraudulent schemes as are alleged in lawsuits involving at least $3.5 billion dollars in life insurance policies

Responding to the discovery of an elaborate conspiracy to defraud millions of dollars from senior insurance policyholders, Mark E. Ross, Cha...

Liu Genshan one of China's richest men, was detained Saturday by police in eastern Zhejiang province on suspicion of taking money from a project

Shanghai tycoon who made his fortune on highways has been arrested on suspicion of fraud, his lawyer said Wednesday, in the latest high-profile corruption case to hit China's economic hub.Liu Genshan, 51, one of China's richest men, was detained Saturday by police in eastern Zhejiang province on suspicion of taking money from a highway project there, his lawyer Wu Yanlei told AFP.The Yongjin highway was worth 7.5 billion yuan (1.1 billion dollars) according to previous state-run press reports. Police were still investigating and prosecutors had yet to lay any charges, Wu said.Several state newspapers reported Liu was arrested on suspicion of money laundering and fraudulent bank loans worth over 600 million dollars, but Wu said he was only accused of taking money from the Yongjin project. Liu, a philanthropist who was named one of China's 15 wealthiest men by Forbes magazine in 2003, is the latest in a long line of high-flying businessmen and politicians in Shanghai to be tarnished by corruption scandals.State media said Liu was a close associate of businessman Zhang Rongkun, who was sentenced in April to 19years in jail for bribery and his part in a massive pension fund scandal that rocked Shanghai in mid-2006.That scandal pulled down the city's former Communist Party chief Chen Liangyu, who was jailed for 18 years in April after being convicted of abuse of power and accepting bribes. More than 20 officials and businessmen have since been convicted in connection with the pension fund scandal.According to his lawyer, police are investigating Liu's transactions in connection with the 185-kilometre (115-mile) Yongjin highway linking Ningbo and the cities of Shaoxing and Jinhua, which opened in 2005. His business strategy was to buy highways using bank loans and turn them into listed companies, the Shanghai Daily said on Wednesday. He reportedly financed seven highways in Shanghai and neighbouring Zhejiang province.Hong Kong's Securities and Futures Commission noticed in 2005 that three billion yuan Liu brought to the territory from the mainland was not transferred through the proper channels, the newspaper sai He allegedly used the money to buy a Hong Kong-listed company, which he renamed Maosheng Holdings, the report said. The company was believed to be the biggest shareholder in a highway linking downtown Shanghai to industrial zones in suburban Qingpu, the report said. Although the road cost 420 million yuan to build, the company's official investment was listed as more than eight times that -- at 3.5 billion yuan, the report said. Investments in other projects were apparently similarly inflated while construction on two was halted due to a lack of funds, the newspaper said. Liu was born in Shanghai but is officially a permanent resident of Hong Kong where he has 1.13 billion Hong Kong dollars (145 million US dollars) invested in a Hong Kong-listed real estate and hotel development company, the report said.

Liu Genshan one of China's richest men, was detained Saturday by police in eastern Zhejiang province on suspicion of taking money from a project

Shanghai tycoon who made his fortune on highways has been arrested on suspicion of fraud, his lawyer said Wednesday, in the latest high-prof...

Tariel Oniani, an ethnic Georgian who is considered among the most influential criminal bosses in the former detained

Russian police swooped in on a helicopter to detain more than 50 reputed crime bosses as they set off for a cruise on a rented boat near Moscow, authorities said Wednesday. Those detained Tuesday included Tariel Oniani, an ethnic Georgian who is considered among the most influential criminal bosses in the former Soviet Union, police said. Angela Kostuyeva, a police spokeswoman, said those detained on a reservoir north of Moscow included 39 «thieves-in-law,» or top figures within the Russian criminal hierarchy. «Thieves-in-law» respect a strict honor-based code that dates back at least to the Stalinist era, when they maintained order in the gulag. Most were released later in the day due to lack of evidence, the spokeswoman said. She refused to say whether Oniani was among those freed. Oniani had called the get-together to discuss a conflict with another crime group that was threatening to lead to a mafia war, the newspaper Kommersant reported. It said Oniani has been wanted in Spain since 2005, when he escaped a sting operation called Wasp that resulted in the arrest of 28 alleged organized crime figures from former Soviet republics on money-laundering charges. Oniani's daughter was among those arrested, Kommersant said. Last month, Spanish police broke up a major Russian organized crime gang, arresting 20 people accused of laundering proceeds from crimes including contract killings and arms and drug trafficking.

Tariel Oniani, an ethnic Georgian who is considered among the most influential criminal bosses in the former detained

Russian police swooped in on a helicopter to detain more than 50 reputed crime bosses as they set off for a cruise on a rented boat near Mos...

David Dench was jailed for four months over his role in a multi-million dollar fraud

<a href="http://3.bp.blogspot.com/_ANNSRoaDZro/SHVMgcKKJfI/AAAAAAAACfo/zRe2LHqyWpQ/s1600-h/dench.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5221163463204283890" src="http://3.bp.blogspot.com/_ANNSRoaDZro/SHVMgcKKJfI/AAAAAAAACfo/zRe2LHqyWpQ/s320/dench.jpg" style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;" /></a> The Hall of Fame inductee's stellar football career and clean record were not enough to spare him time behind bars after a judge said he had shown no remorse. Dench, 56, was brought into a long-running scam at Victoria University by his employer, John Mario Cappellin, in 1999. The County Court heard corrupt university insiders rubber-stamped invoices for Cappellin's maintenance company, which included work never done or done at inflated prices. Dench's lawyer Bernie Balmer said outside court his client had paid a heavy price for his relationship with Cappellin and had netted a "ridiculously small" share of less than $5500. The North Melbourne great was found guilty by a jury last month of nine counts of obtaining property by deception and two of aiding and abetting the receipt of a secret commission, which related to between $60,000 and $75,000. Judge Tim Wood said though Dench's role was small it did "constitute a cog in the machine" to defraud the institution. "Your fraud was a sophisticated one, involving elaborate measures of concealment, vast amounts of documents . . . "It was an inherently difficult crime to detect and required vast resources to unearth it," he said. Judge Wood acknowledged testimonials by former teammate Wayne Schimmelbusch and coach John Kennedy, who painted Dench as a role model. "You have led a blameless life in terms of the criminal law, were a contributor to society in a positive sense, a devout and supportive family man and achieved an illustrious football status," he told Dench. But Judge Wood noted Dench had denied guilt in the face of strong evidence, which included work carried out at Dench's home billed to the university. Mr Balmer said his client was holding up well and would not appeal against his sentence. "He's a fellow who's used to pressure, but he worries about family and friends and the shame that it brought them as well as himself," he said. "It's a heavy price to pay. "He just wants to get the next 3 1/2 months out of the road, settle with the university and get on with life." Mr Balmer said Dench regretted crossing paths with Cappellin. "You meet people in your life who just drag you down using your reputation," he said. "That's regrettable. He should perhaps have been a titchy bit smarter about that." Mr Balmer said Dench had hoped for a suspended sentence but understood the penalty. "You've got to send a message to others -- regrettably, it's a fellow that this town's known or loved for a long, long time," Mr Balmer said. Judge Wood suspended a further 10 months of Dench's sentence for two years.

David Dench was jailed for four months over his role in a multi-million dollar fraud

The Hall of Fame inductee's stellar football career and clean record were not enough to spare him time behind bars after a judge said he...

Keith Cowell, 52, his son Matthew, 17, and 33 year old Tony Dulieu from Billericay, were executed by sub-machine in living room of the Cowells' home in Plaw Hatch Close, Bishop Stortford

murder victim Keith Cowell was "perturbed" about a drug deal his teenage son was involved in, a court heard today (Wednesday July 9). Brian "Jumbo" Johnstone said his golfing friend Keith, formerly of Buntingford, told him about a row over the quality of cocaine supplied to an Asian man called Mike. He told St Albans Crown Court he had worked with Keith Cowell for 10 to 12 years in security at the London Arena and Wembley Stadium, and had known Matthew since he was a boy.Asked by prosecutor Stuart Trimmer if Keith had been involved in drugs, he said: "Yes, I knew he had something to do with drugs. "As far as I was concerned I was aware he sold a little bit of grass - that's all, nothing exciting."But he said that Keith told him about a deal involving high grade cocaine, known as 'Shine'. He said: "He was a bit perturbed that his son Matthew had been approached at a funeral by an Asian guy called Mike who wanted to buy Shine - high grade cocaine. It sparkles - that is why it is called Shine."Keith got in touch with his nephew Ian Jennings. Ian deals in drugs. Keith told me they did a deal and Michael was not happy. He wanted his money back and Ian was very loath to give him his money back. "Mr Johnstone said the first deal had been for half a kilo of the drug. Later he said Mike had wanted a kilo of the drug. "I though after the row it seemed a strange thing to do." He added: "I saw Keith on the day he died. He had been playing golf. He came to my house and we went to the golf shop in Nazeing and I bought a golf club as a birthday present for him. He was a very, very good friend." Keith Cowell, 52, his son Matthew, 17, and 33 year old Tony Dulieu from Billericay, were executed by sub-machine in living room of the Cowells' home in Plaw Hatch Close, Bishop Stortford on August 28 last year. Keith sister's Christine Jennings, 54, was shot and stabbed in the living room. Matthew's girlfriend Claire Evans, 23, was stabbed in a bedroom as she protected her three-year-old daughter. The Cowells pet Staffordshire puppy called Gorgeous was also shot dead.Ian Jennings, 32, who had brought a kilo of cocaine to the house managed to escape the slaughter by hiding in the back garden. He had been in the kitchen of the house when two men burst in.Miran Thakrar was allegedly armed with the sub-machine gun and was accompanied by his brother Kevan.The prosecution sasy Miran was angry that he had been supplied with half a kilo of 'Repress', the lowest quality of the drug. He had been expecting Shine.Cross examined by Brendan Kelly QC for Miran Thakrar - the man known as Mike - Mr Johnsstone said he had not told the police about his conversation with Keith in his first interview with them because he had needed permission from his widow Nicky to tell them about the drugs."I did not want to bad mouth Keith without speaking to her first. We had just lost three people shot and two wounded over a piece of stupidity."Miran Thakrar, 24, and Kevan Thakrar, 21, plead not guilty to the murder of Keith and Matthew Cowell and Tony Dulieu, from Billericay, Essex at the Cowells' home in Plaw Hatch Close, Bishop's Stortford on August 28 last year.Miran Thakrar, of no fixed address, and Kevan, of Lomond Way, Stevenage, also deny the attempted murders of Claire Evans and Christine Jennings in the house on the same day and having an Ingram Mac 10 sub-machine gun with intent.Their brother Jay Thakrar, 25, of Lomond Way, Stevenage, has pleaded not guilty to two counts of assisting an offender. One relates to providing petrol between August 27 and August 30 for the burning of a car used by Miran Thakrar and the other alleges he assisted Kevan Thakrar to evade arrest. Their father Atul Thakrar, 47, of Compton Place, Northwood, Middlesex, has pleaded not guilty to assisting Kevan Thakrar to attempt to leave the UK between August 28 and September 5.Co-defendant Amanda Dansie, 21, of High Street, Buntingford, has pleaded not guilty to assisting in the escape of Miran Thakrar from the UK between August 28 and September 9.Yilay Tufensoy, 20, of Nags Head Road, Enfield, denies two charges of assisting an offender. In one charge he is alleged to have assisted Miran Thakrar flee the UK and in the other he is accused of assisting Kevan Thakrar's attempts to flee the UK.

Keith Cowell, 52, his son Matthew, 17, and 33 year old Tony Dulieu from Billericay, were executed by sub-machine in living room of the Cowells' home in Plaw Hatch Close, Bishop Stortford

murder victim Keith Cowell was "perturbed" about a drug deal his teenage son was involved in, a court heard today (Wednesday July ...

Jagmeet Channa tried to steal $141 million from HSBC was sentenced to nine years in jail.

British bank clerk who tried to steal $141 million from HSBC was sentenced Monday to nine years in jail.Jagmeet Channa, 25, who worked at the bank's London headquarters, had admitted charges of conspiracy to defraud and money laundering.Channa had sent 60 million euros ($94 million) to an account in Morocco and 30 million euros ($47 million) to an account in Britain in April. The fraud was detected by an HSBC (nyse: HBC - news - people ) employee in Malaysia."There is no mitigation aside from age, stupidity and his plea," said his lawyer, Peter Corrigan.Prosecutor David Levy said that although HSBC Holdings PLC recovered the money, it lost about 54,000 pounds ($107,000) in interest during the time the funds were in other accounts. He said Channa has not provided any information about the others involved in the crime."Others were involved, perhaps several others, and in the absence of any explanation from you I must assume this was a planned and sophisticated criminal enterprise," Judge Geoffrey Rivlin told Channa."You say you had no idea who these people were or what was going to happen to the money. I regret I cannot accept this statement."

Jagmeet Channa tried to steal $141 million from HSBC was sentenced to nine years in jail.

British bank clerk who tried to steal $141 million from HSBC was sentenced Monday to nine years in jail.Jagmeet Channa, 25, who worked at th...

Sadia Nasir, a director of Ilford-based London Mortgage and Financial Services, is the 12th mortgage broker to be banned by the Financial Services Authority this year, but the first to date to be both banned and fined for mortgage fraud.

Sadia Nasir, a director of Ilford-based London Mortgage and Financial Services, is the 12th mortgage broker to be banned by the Financial Services Authority this year, but the first to date to be both banned and fined for mortgage fraud.The regulator said Ms Nasir, whose firm traded as House of Finance, had entered her own bank account details on four mortgage applications submitted for clients.She also submitted seven mortgage applications containing false information about her own employment and earnings, with these supported by falsified documents including payslips, financial statements and accountant's certificates. The FSA said she also deliberately withheld sections of an application form from its investigators, failed to disclose information about a County Court Judgment made against her and also failed to disclose the true extent of her assets when she applied for authorisation.It said the six-figure fine she received aimed to take back the profits she had made from the fraud, as well as to deter other brokers from submitting fraudulent claims.Margaret Cole, director of enforcement at the FSA, said: "Ms Nasir's actions were particularly serious and blatant, and she poses an immediate risk to lenders."We have banned a number of mortgage brokers and others this year in connection with mortgage fraud but the problem persists." She said the FSA had made a commitment to increase fines in the retail sector to act as a deterrent.She said: "We will continue with this new policy and intensify our crackdown on mortgage fraud. Perpetrators will increasingly find themselves facing bans, heavier fines and having to disgorge illicit gains."

Sadia Nasir, a director of Ilford-based London Mortgage and Financial Services, is the 12th mortgage broker to be banned by the Financial Se...

Steve Brownell allegations that the Kansas City man defrauded three investors out of about $574,000 in a trucking investment scheme.

Steve Brownell allegations that the Kansas City man defrauded three investors out of about $574,000 in a trucking investment scheme. In a release Wednesday, Nixon said that he filed the charges May 28 in Jackson County Circuit Court and that Brownell hasn't turned himself in to authorities. Nixon's charges allege that Brownell persuaded three Kansas City-area individuals to invest in the purchase of dump trucks, which Brownell said would be used to haul rock, sand, asphalt and salt. Brownell allegedly represented that in return for their investments, investors would get a percentage of the profits from each truck. Instead, Nixon alleged, investors received little if any return on their investments. Nixon's office encourages anyone who has seen Brownell or has information on his whereabouts to contact Nixon's office at 816-889-5029 or 573-751-0702. Brownell is described as a white male, 51 years old, 6 feet tall and about 185 pounds, with a medium build and blue eyes. Securities fraud is an unclassified felony under Missouri law, punishable by as much as 10 years in prison for each count, as much as a $10 million fine, or both

Steve Brownell allegations that the Kansas City man defrauded three investors out of about $574,000 in a trucking investment scheme.

Steve Brownell allegations that the Kansas City man defrauded three investors out of about $574,000 in a trucking investment scheme. In a re...

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