Bankrupt Banker

Securities and Exchange Commission charged a missing hedge fund manager with fraud

<a href="http://4.bp.blogspot.com/_ANNSRoaDZro/SXiiyrjH15I/AAAAAAAAFaE/TG4mV4N2-t4/s1600-h/nadel.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5294160353541216146" src="http://4.bp.blogspot.com/_ANNSRoaDZro/SXiiyrjH15I/AAAAAAAAFaE/TG4mV4N2-t4/s400/nadel.jpg" style="float:left; margin:0 10px 10px 0;cursor:pointer; cursor:hand;width: 97px; height: 129px;" /></a> Securities and Exchange Commission charged a missing hedge fund manager with fraud on Wednesday, saying he misled investors and overstated the value of investments in six of his funds by at least $300 million.The six funds appear to have total assets of less than $1 million, the S.E.C. said in a civil lawsuit filed in Federal District Court in Tampa, Fla. It said the fund manager, Arthur Nadel of Sarasota, Fla., had recently transferred at least $1.25 million from two funds to a secret bank account he controlled.Mr. Nadel disappeared on Jan. 14 and authorities say he fled Florida. In a suicide note left at his home, Mr. Nadel admitted that he lost clients’ money and feared they would want to kill him, The Sarasota Herald-Tribune reported.On Wednesday the S.E.C. obtained a court order freezing Mr. Nadel’s assets and those of other defendants in the case.“Mr. Nadel’s alleged actions deceived investors, and we are seeking to hold him accountable for that misconduct,” David Nelson, director of the S.E.C.’s Miami regional office, said in a statement. Two investment companies controlled by Mr. Nadel, Scoop Capital and Scoop Management, consented in a settlement with the S.E.C. to injunctions, asset freezes and the appointment of a receiver. They neither admitted nor denied wrongdoing. The S.E.C. also is seeking restitution plus interest from several so-called relief defendants: the investment advisers Valhalla Management and Viking Management, and the hedge funds Scoop Real Estate, Valhalla Investment Partners, Victory IRA Fund, Victory Fund, Viking IRA Fund and Viking Fund.Those defendants consented to an asset freeze, also without admitting or denying the allegations. <blockquote>The S.E.C. said Mr. Nadel claimed in offering materials that three of the funds had about $342 million in assets as of Nov. 30. The offering materials for several of the funds also claimed monthly returns of 11 to 12 percent last year, when they actually had negative results, the agency said.</blockquote> In his suicide note, Mr. Nadel described the “extreme guilt he was feeling over business actions that he had taken which resulted in the loss of other people’s money,” a Sarasota County sheriff’s deputy wrote in a report, according to The Herald-Tribune.Mr. Nadel’s note stated “there are those that would like to kill him, but that he will do it himself.”Federal law enforcement authorities have tracked Mr. Nadel to Slidell, La., the newspaper said. No criminal charges have yet been filed against him and there is no warrant for his arrest.

Securities and Exchange Commission charged a missing hedge fund manager with fraud

Securities and Exchange Commission charged a missing hedge fund manager with fraud on Wednesday, saying he misled investors and overstated t...

charges were filed against four people accused of being involved in a million-dollar mortgage fraud scheme

Attorney General Mike Cox said Wednesday that charges were filed against four people accused of being involved in a million-dollar mortgage fraud scheme. <blockquote>Dequincy Hyatt of Detroit, Seaesther Thompson-Hayes of Flat Rock and Aaron Brooks Jr. of Southgate were charged with one count each of racketeering, a 20-year felony, and two counts each of false pretenses, a 10-year felony.Pietro Biundo is accused of filing a falsified deed, a 5-year felony, when selling his Washington Township home in one of the transactions, according to Cox's office.</blockquote> The complaint regarding the Washington Township house was brought to authorities' attention by Sterling Heights-based real estate mogul Ralph Roberts.A Michigan State Police and Attorney General's Office investigation determined that in 2006, Hyatt, managing partner of J.B. Homes/Construction LLC.; Hayes, a mortgage broker, and Brooks, an ex-service representative for the People's Trust Credit Union, completed mortgage fraud by using a straw buyer on two luxury houses -- the one in Washington Township and a second in Shelby Township -- that went into foreclosure, Cox's office said.

charges were filed against four people accused of being involved in a million-dollar mortgage fraud scheme

Attorney General Mike Cox said Wednesday that charges were filed against four people accused of being involved in a million-dollar mortgage ...

Grand Island insurance agency with more than $100 million in debts is being investigated for possible fraud

Grand Island insurance agency with more than $100 million in debts is being investigated for possible fraud and for selling investments in the company despite promising not to do so, state officials said Wednesday.First Americans Insurance Service Inc., which served Native American tribal governments, entered a voluntary moratorium in August 2007 against selling its debt, according to the State Banking Department.But in an order stopping any more such sales, the department said evidence indicates that company agents sold promissory notes to a Kansas resident and at least three Nebraskans between October 2007 and November 2008.Selling such notes without proper authorization would violate the Securities Act of Nebraska and would be a felony, said Sheila Cahill, legal counsel for the Banking Department's Bureau of Securities.State banking officials also were looking into what investors were told about the company and how the promissory notes were described, Cahill said.Stella Levea, First Americans president and treasurer, did not return several phone calls seeking comment.The company filed for Chapter 11 bankruptcy this month. One investor told The World-Herald he was asked to put money into the company only weeks before its Jan. 12 bankruptcy filing.Arthur Kline, 90, of Grand Island, said he invested $50,000 in addition to more than $100,000 he had invested years earlier. "It feels like I got the shaft," Kline said.Nebraska Attorney General Jon Bruning said the State Patrol would help conduct the criminal investigation."A loss of this magnitude without a real explanation of how that loss occurred certainly raises questions about whether fraud occurred," Bruning said.Along with Levea, executives of the company include James Masat and Kenneth Mottin.In its bankruptcy filing, First Americans listed hundreds of creditors, many of them Nebraskans. Major creditors are owed as much as $5.7 million and $3.8 million, according to the bankruptcy filing.The company works with tribal governments, businesses and casinos in more than 20 states, writing commercial property and casualty and workers' compensation policies through several insurance firms, said Omaha attorney Robert Craig, who is handling the Chapter 11 bankruptcy filing for First Americans. The insurance policies sold to tribes through the agency appear to remain in force, Craig said.The company, which employs about 20 people, said it had between $100 million and $500 million in liabilities and up to $10 million in assets."It's a very big gap. There's nothing I could say that would eliminate that," Craig said, adding that the liabilities were closer to $100 million than $500 million.Some people, Craig said, have referred to the company's selling of debt as a "Ponzi scheme," which is a type of fraud that provides returns to investors out of money paid by new investors. Eventually such schemes collapse.First Americans sold promissory notes to investors and promised high returns, Craig said. That structure got "out of control," but calling it a Ponzi scheme is inaccurate, he said."It's a very well-run and productive insurance agency," Craig said. "It's this investment vehicle used that ended up getting out of control."

Grand Island insurance agency with more than $100 million in debts is being investigated for possible fraud

Grand Island insurance agency with more than $100 million in debts is being investigated for possible fraud and for selling investments in t...

Charged yesterday Zohrab Marashlian, 64 and John Athanasiou, 63

Charged yesterday in indictments filed in federal court in Brooklyn were Zohrab Marashlian, 64, the former president of the civil division of Perini, which is headquartered in Massachusetts, and John Athanasiou, 63, the former director of purchasing for the firm's civil division, according to court documents.Attorneys for the two could not immediately be reached. Assistant U.S. Attorney Burton Ryan declined to comment.Company spokesman Tom Davies referred a reporter to a recent company filing with the Securities and Exchange Commission in which the company said it was in process of attempting to negotiate a civil settlement with the U.S. Attorney's office in connection with the investigation. Perini, which could lose government contracts if convicted of crimes in connection with the scheme, was not charged yesterday. In the SEC filing, the company said the investigation "concerns contracting between the company's civil division and disadvantaged, minority, and women-owned businesses in the New York City area construction industry." Marashlian is scheduled to be arraigned on the charges later this month. Athanasiou is in Greece visiting his sick mother and will be arraigned later, officials said. Among the projects that authorities say were not performed by minority-owned businesses as claimed: Parts of a West Side Highway project in Manhattan; the connector project involving the Brooklyn-Queens Expressway and the Williamsburg Bridge and the Queens Boulevard/Honeywell Street Bridge project in Long Island City, according to the indictment.Several executives of minority-owned firms that participated in the scheme in return for kickbacks have pleaded guilty and are awaiting sentencing.

Charged yesterday Zohrab Marashlian, 64 and John Athanasiou, 63

Charged yesterday in indictments filed in federal court in Brooklyn were Zohrab Marashlian, 64, the former president of the civil division o...

Bank of America, , charged that Steel Partners "pulled off a classic 'bait and switch"

Bank of America, acting as master trustee for ACF Industries' employee benefits plan, charged that Steel Partners and its manager, Warren Lichtenstein, "pulled off a classic 'bait and switch' by stripping investors of what they had purchased and replacing it with something entirely different."ACF, a manufacturer of railcars and railcar components, and, according to the documents, affiliated with billionaire investor Carl Icahn, invested $15 million in 2005 with Steel Partners Offshore Fund Ltd, which became Steel Partners II (Offshore) Ltd.Bank of America referred calls to attorney Keith Schaitkin at Icahn Associates, who referred Reuters to the court documents.Steel Partners said it does not believe the lawsuit has any merit."We intend to vigorously contest it in court in order to protect the interests of the Partnership and all of our investors," the firm said in a statement.The court documents said that while Lichtenstein had originally promised to invest in cheaply valued small companies and put no more than 25 percent of the fund's assets into illiquid investments and special situations, he acknowledged in December that things had changed.According to the lawsuit, 38 percent of Steel's investors demanded their money back late last year in the wake of heavy losses, but Steel Partners suspended redemptions.The lawsuit said that instead of selling assets to raise cash to meet clients' demands for their money, Lichtenstein planned to turn the portfolio into a public company to deal with withdrawal notices.The lawsuit said Lichtenstein spoke with Icahn on December 24 about "his plans for the Fund and how to satisfy the redemption requests."Lichtenstein told Icahn there would be advance notice of the proposed plan and meetings with investors in early January and that no action would be taken to implement the plan until February at the earliest, according to the documents.The lawsuit also claims that by December 31, the Fund had transferred all of its investments to a non-SEC reporting 'public' shell company and that all of this had been done "without the knowledge and consent of investors."

Bank of America, , charged that Steel Partners "pulled off a classic 'bait and switch"

Bank of America, acting as master trustee for ACF Industries' employee benefits plan, charged that Steel Partners and its manager, Warre...

Pharmaceutical giant Eli Lilly & Company ("Lilly") will pay federal and state governments more than $1.4 billion

Pharmaceutical giant Eli Lilly & Company ("Lilly") will pay federal and state governments more than $1.4 billion to remedy a wide-ranging, off-label marketing scheme for its prescription drug, Zyprexa(R). This settlement is the largest qui tam settlement in the history of the False Claims Act. Stephen A. Sheller, a well-known mass tort and class action lawyer from Philadelphia, filed the first Complaint in the case in February 2003, bringing the off-label drug allegations to the government under seal as required by law. Today, after six years, the Department of Justice settled with Lilly the allegations that six former Lilly drug marketing representative whistleblowers brought to Sheller.Lilly will pay more than $1.4 billion for its illegal off-label marketing of the antipsychotic drug, the U.S. Attorney's Office for the Eastern District of Pennsylvania announced. Zyprexa is Lilly's top-selling drug with worldwide sales of nearly $40 billion since its approval in 1996.In today's settlement, Lilly will pay $800 million in civil penalties and plead guilty to criminal charges, paying an additional $600 million fine. The six whistleblowers who brought the Complaint against the drug company will share in approximately 18 percent of the federal and qualifying states' recoveries, Sheller said.Related complaints filed by other law firms in 2005, 2006 and 2007 were ultimately consolidated into Sheller's first-filed Complaint."The reason the settlement and fine are record-breaking is because Eli Lilly perpetrated an outrageous fraud on the American government and taxpayers" said Sheller. The whistleblowers represented by Sheller, two with 27 or more years' service at Lilly, expressed concern through proper channels about Lilly's improper marketing practices. All six whistleblowers were eventually fired or forced to resign. One sales representative, who also is a pharmacist, contacted the company hotline regarding unethical sales practices but received no response, according to the Complaint. <blockquote>Zyprexa is approved by the U.S. Food and Drug Administration ("FDA") for very limited conditions - schizophrenia and a specific type of bipolar disorder. Under FDA rules, prescription drug manufacturers and marketers may only promote their products for approved uses.</blockquote> To boost sales, Eli Lilly marketed Zyprexa for numerous off-label uses including Alzheimer's, depression and dementia according to Sheller's Complaint. Eli Lilly's off-label sales strategies were very effective. The government's investigation found that a substantial amount of Zyprexa sales were for off-label uses, particularly in children and the elderly

Pharmaceutical giant Eli Lilly & Company ("Lilly") will pay federal and state governments more than $1.4 billion

Pharmaceutical giant Eli Lilly & Company ("Lilly") will pay federal and state governments more than $1.4 billion to remedy a w...

Paul Timothy Moore, 61, of Columbia, and nine others were charged in a federal complaint with theft of federal program funds, mail fraud, wire fraud

Paul Timothy Moore, 61, of Columbia, and nine others were charged in a federal complaint with theft of federal program funds, mail fraud, wire fraud and conspiracy, for their alleged roles in a scheme to embezzle more than $5.5 million dollars from DSS.DSS is one of the largest state agencies, with 4,400 employees and an annual budget of over $1.2 billion dollars. It is responsible for overseeing programs ranging from protecting children and the elderly from abuse to providing food and temporary financial assistance to the needy. The complaint and arrest warrants were signed this morning by U.S. Magistrate Judge Paige J. Gossett in Columbia.An affidavit presented by a U.S. Secret Service Agent outlined the scheme: Moore allegedly used his position as the agency’s finance director to authorize the issuance of about 761 DSS checks, averaging about $7,000 each, between May 2004 and October 2008. The checks were made payable to names, which authorities believe were provided by a co-conspirator, Jonathon Moses, 42, of Columbia, who recruited people to cash the checks and split the proceeds.Eight other people are suspected of having cashed some of the checks and/or having recruited others into the scheme: Herbert McKie, 27, Aisha Leheva Crumpton, 23, Tyra L. Goodson, 36, Nova Kathleen Johnson, 40, and Sandra Denease Smith, 45, all of Columbia; and Gwendolyn Robinson, 41, Ortyse S. Mazone, 37, and Calandra Fabary Thomas, 38, all of Aiken.Moore and Moses were arrested this morning and remain in custody until making an initial appearance in federal court in Columbia later today.Wilkins said he expects additional arrests. The maximum penalty for theft of federal program funds and conspiracy is 10 years and a fine of $250,000; mail fraud and wire fraud each carry a maximum sentence of 20 years and a $250,000 fine.

Paul Timothy Moore, 61, of Columbia, and nine others were charged in a federal complaint with theft of federal program funds, mail fraud, wire fraud

Paul Timothy Moore, 61, of Columbia, and nine others were charged in a federal complaint with theft of federal program funds, mail fraud, wi...

Marcus Schrenker, 38, was at Tallahassee Memorial Hospital, where he was banned from seeing visitors and under watch of U.S. Marshals and guards

<a href="http://1.bp.blogspot.com/_ANNSRoaDZro/SXC58vEcPKI/AAAAAAAAFT8/N4dHbcmzC_c/s1600-h/marcus.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5291934015238716578" src="http://1.bp.blogspot.com/_ANNSRoaDZro/SXC58vEcPKI/AAAAAAAAFT8/N4dHbcmzC_c/s320/marcus.jpg" style="float:left; margin:0 10px 10px 0;cursor:pointer; cursor:hand;width: 209px; height: 240px;" /></a> Marcus Schrenker, 38, was at Tallahassee Memorial Hospital, where he was banned from seeing visitors and under watch of U.S. Marshals and guards. He was expected to remain at the hospital until at least today, said Scott Wilson, a judicial security inspector for the U.S. Marshals' service in the Northern District of Florida.Schrenker, who is president and chief executive of The Icon Group and a handful of small affiliated financial companies, faces financial fraud charges in Indiana, where state regulators have said it appears he misappropriated hundreds of thousands of dollars in client money.He first will be tried in a Florida federal court on charges that he faked a distress call to authorities. Once he is released from the hospital, Schrenker will be taken to jail in Pensacola, Fla., where he will await trial.Schrenker, a certified pilot, had departed in his plane from Anderson Municipal Airport and said he was headed to Destin, Fla. He made a distress call over central Alabama late Sunday, saying the window of his plane shattered while he was flying. Authorities, however, said the plane's window was not shattered.Schrenker set the plane on autopilot and parachuted from it near Childersburg, Ala. The plane flew close to houses before crashing into a swampy area near Pensacola.Authorities say he then made his way to a motorcycle he had stashed in a nearby town and rode it to a KOA campground in Chattahoochee, Fla.U.S. Marshals arrested Schrenker at the KOA campground late Tuesday. They found him in a tent, nearly unconscious and bleeding profusely from a slit wrist.In the weeks before his aborted flight, Schrenker's lavish Geist home and his Fishers business were searched by the Indiana secretary of state's securities division, which seized financial records and froze assets.He is charged with two felony counts alleging he worked as an investment adviser without being registered. His registration was terminated Dec. 31, but investigators say he continued dealing with clients after that.Schrenker's wife, Michelle, filed for divorce Dec. 30.Her lawyer, Mary Schmid, has released a statement saying Michelle Schrenker wanted to end the marriage because her husband had an affair and her decision "in no way was based on the investment fraud of which he is accused."Although she is not charged in the current state complaints, authorities said bank deposit slips in Michelle Schrenker's name and a company envelope with her name on it were among items seized by state investigators in a search of the home and Marcus Schrenker's offices last month.

Marcus Schrenker, 38, was at Tallahassee Memorial Hospital, where he was banned from seeing visitors and under watch of U.S. Marshals and guards

Marcus Schrenker, 38, was at Tallahassee Memorial Hospital, where he was banned from seeing visitors and under watch of U.S. Marshals and gu...

Missing investment manager Marcus Schrenker's theft conviction

Missing investment manager Marcus Schrenker's , whose small plane crashed Sunday night en route to Florida in what may have been an attempt to fake his own death, over the years convinced dozens of active and retired Delta pilots to allow him to manage their retirement accounts. Marcus Schrenker's theft conviction, involvement in securities lawsuits filed against him by past clients and questions about whether he was reporting all of his income to U.S. tax officials started to unravel more than two years ago in an unlikely place for the aviation buff — Delta Air Lines' bankruptcy case.Then, in 2006, according to court records, he turned his attention to Delta's bankruptcy case, enlisting a group of pilots opposed to Delta's plan to terminate their pension plan to let him help them fight Delta."He had a way about him — you trusted the guy," David M. Smith, one of the retired pilots, said Tuesday. "He was very credible. He talked a good story. So, we entrusted him with a task he never produced."Two days before the Sept. 1, 2006, hearing at which Schrenker was supposed to testify about an analysis he had done that challenged Delta's assertions about the viability of its pension plan, he suddenly withdrew from the case.He literally was a no-show," Smith recalled. "He literally just disappeared. We were shocked at the whole thing."It's not exactly clear if Schrenker received any money for his services in the Delta case — Smith said he didn't pay him any money for his help — but after his withdrawal from the case, the retired pilots were unsuccessful in stopping Delta from terminating the pension plan, and the group accepted a small settlement from the airline."I think we would have been more successful if we had not had him in the first place," Smith said of Schrenker. "He was a vast distraction."Smith, 59, believes Schrenker may again be running from his past, which Smith got a glimpse of after Schrenker was deposed by a Delta lawyer just days before the 2006 hearing that Schrenker didn't attend."I believe he was scared to death that Delta was going to expose him," Smith said.One of the attorneys that represented the retired pilots group, Sherwin Kaplan, declined to comment about Schrenker. Another attorney who represented the group and was an advocate for Schrenker during the Delta deposition, Sara Pikofsky, did not return several phone calls to her office seeking comment. A lawyer who represented Schrenker in a 2003 bankruptcy case, Orval Schierholz, did not immediately return a call to an Indiana home listed in his name.According to the deposition conducted Aug. 27, 2006, Schrenker was charged in 1990 in Porter County, Indiana, with receiving stolen property involving the theft of jewelry from a home. Documents Delta's lawyer produced during the deposition show he was sentenced to 16 days in county jail. Schrenker had said earlier in the deposition that he had only received probation for the offense and that his record was later expunged.The lawyer also questioned Schrenker about several securities lawsuits filed against him by past clients. "They were lawsuits that were filed around the surroundings of 9/11," Schrenker responded, referring to the terror attacks of Spt. 11, 2001 that involved four hijacked airliners. "It was one attorney representing three or four people who indicated in their filings that we should have known the events of 9/11 could have happened and the securities accounts could have dropped."Then there was the matter of the Internal Revenue Service.Bankruptcy 7 liquidation petitions were filed on Schrenker's behalf in bankruptcy court in 1991 and 2003, according to records produced by Delta's lawyer during the deposition.In the 2003 case, according to records produced during the deposition, the court accused Schrenker of not disclosing thousands of dollars in monthly income to the court and not reporting the income on his tax returns.A court-appointed trustee filed documents alleging that in the months prior to filing the 2003 bankruptcy petition, Schrenker's business bought more than $29,000 in audio/visual equipment and ordered $16,000 worth of landscaping services that were provided to Schrenker's home. The documents accused Schrenker of "fraudulent conveyance," according to statements by Delta's lawyer during the deposition.Schrenker defended the purchase of the equipment for his business. He also insisted the landscaping was for his office, not his home."All these fraudulent conveyances, the trustee is obviously motivated to make it appear as we've done something fraudulent because they recover 33 percent of every dollar that they can squeeze out of these small companies," Schrenker said during the deposition.

Missing investment manager Marcus Schrenker's theft conviction

Missing investment manager Marcus Schrenker's , whose small plane crashed Sunday night en route to Florida in what may have been an atte...

Satyam's disgraced founder Ramalinga Raju and his brother Rama Raju were sent to judicial custody for 14 days

Satyam's disgraced founder Ramalinga Raju and his brother Rama Raju were sent to judicial custody for 14 days on Saturday while the CFO ...

Richard T. Nelson, the former general counsel of Peregrine Systems Inc., admitted Thursday in U.S. District Court to inflating the company's revenue

Former executive for a San Diego-based software company who failed to correct false and misleading financial statements has pleaded guilty t...

Satyam Computer Services,Indias Enron Satyam's chairman, Ramalinga Raju arrested

Satyam Computer Services, an outsourcing company that serves more than a third of the Fortune 500, had been significantly inflating its earnings and assets for years. According to the Satyam's chairman, Ramalinga Raju, more than $1 billion in cash and bank loans the company listed in assets were simply nonexistent. Satyam's clients have included General Electric, General Motors and U.S. government, and already the scandal is being compared to the Enron collapse.Such a significant and far-reaching fraud naturally has serious implications for the United States. Namely, whatever happened to the kind of can-do fraudulent American spirit we used to have? Our great nation used to be number one in perpetrating financial misdoings. Now it appears that not only are Indian companies taking away American jobs, but they're also taking away American felonies.First of all, sending fraud overseas is a slap in the face to unskilled CEOs at home who can do little more than skim money off the top and create offshore accounts. Additionally, outsourcing fraud exploits lower paid criminals. The Satyam fraud amounts to $1.04 billion, a piddling sum when compared with the $50 billion lost in the American Madoff scandal.But most importantly, when white-collar crime is outsourced, we simply can not expect the same quality of service we get when being defrauded domestically. American frauds have destroyed companies, wrecked charities, wiped out retirement and college savings and ruined lives. They have done so quickly, efficiently and completely. Outsourced fraud like the Satyam case, however, has forced some companies to investigate their practices and perhaps reorganize the partners with whom they do business.

Satyam Computer Services,Indias Enron Satyam's chairman, Ramalinga Raju arrested

Satyam Computer Services, an outsourcing company that serves more than a third of the Fortune 500, had been significantly inflating its earn...

Sunshine Coast couple fleeced in a Nigerian money scam have been charged with fraud after allegedly netting more than $4m in the same operation.

Sunshine Coast couple fleeced in a Nigerian money scam have been charged with fraud after allegedly netting more than $4m in the same operation.Police allege the 48-year-old man and 40-year-old woman became victims of fraud when they sent money to suspected Nigerian fraudsters in September, 2003.It is believed they were invited to take part in a Nigerian oil contract but the contract did not exist.The couple then allegedly invited people to take part in the fraud and 12 people sent more than $4.3 million to the alleged Nigerian criminals.The pair are among six people charged in relation to the scam.Police minister Judy Spence said people continued to fall victim to the schemes despite warnings by police.Ms Spence said the scams were not new but in the current economic climate, people were more likely to fall for get-rich-quick schemes."People looking for an easy way out of their financial and mortgage stress can make for easy victims," she said."People need to realise there is no such thing as easy money and any scheme that promises massive returns for a small investment will inevitably turn out to be a scam that could cost a victim their entire life savings."Most amazing of all, even after police issue warnings to individuals who have already sent money police often find themselves going back to find these same people have sent even more money. They end up losing massive amounts."Queensland Police fraud and corporate crime Detective Superintendent Brian Hay said there were precautions people could take to make sure they did not fall victim to Nigerian scams."If you don’t know the person asking you for money or don’t know enough about the operation then don’t send the money," he said."Fraudsters operate on the assumption that victims will see the opportunity rather than applying common sense or logic to these schemes."Time and time again we state that if it seems too good to be true, then it often is."He warned that fraudsters may also send what appeared to be legitimate paperwork as evidence but the documents would also be fraudulent.More information about how to protect yourself from the scams can be found on the Queensland Police website.The Coast couple are each due to face two counts of fraud in a Maroochydore Magistrates Court today.

Sunshine Coast couple fleeced in a Nigerian money scam have been charged with fraud after allegedly netting more than $4m in the same operation.

Sunshine Coast couple fleeced in a Nigerian money scam have been charged with fraud after allegedly netting more than $4m in the same operat...

Ramalinga Raju, resigned after revealing that he had systematically falsified accounts

<a href="http://1.bp.blogspot.com/_ANNSRoaDZro/SWTXo9FTRUI/AAAAAAAAFPs/5hNf3073O9k/s1600-h/raju_4.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5288588961031341378" src="http://1.bp.blogspot.com/_ANNSRoaDZro/SWTXo9FTRUI/AAAAAAAAFPs/5hNf3073O9k/s400/raju_4.jpg" style="float:left; margin:0 10px 10px 0;cursor:pointer; cursor:hand;width: 250px; height: 250px;" /></a> Satyam Computer Services, a leading Indian outsourcing company that serves more than a third of the Fortune 500 companies, significantly inflated its earnings and assets for years, the chairman and co-founder said Wednesday, roiling Indian stock markets and throwing the industry into turmoil. The chairman, Ramalinga Raju, resigned after revealing that he had systematically falsified accounts as the company expanded from a handful of employees into a back office giant with a work force of 53,000 and operations in 66 countries. Mr. Raju said Wednesday that 50.4 billion rupees, or $1.04 billion, of the 53.6 billion rupees in cash and bank loans the company listed in assets for its second quarter, which ended in September, were nonexistent. Revenues for the quarter were 20 percent lower than the 27 billion rupees reported, and the company’s operating margin was a fraction of what it declared, he said Wednesday in a letter to directors that was distributed by the Bombay Stock Exchange. Satyam serves as the back office for some of the largest banks, manufacturers, health care and media companies in the world, handling everything from computer systems to customer service. Clients have included General Electric, General Motors, Nestlé and the United States government. In some cases, Satyam is even responsible for clients’ finances and accounting. The revelations could cause a major shake-up in India’s enormous outsourcing industry, analysts said, and may force many large companies to investigate and perhaps revamp their back offices. “This development is going to have a major impact on Satyam’s business with its clients,” said analysts with Religare Hichens Harrison on Wednesday. In the short term “we will see lot of Satyam’s clients migrating to competition like Infosys, TCS and Wipro,” they said. Satyam is the fourth-largest outsourcing firm after the three named. In the four-and-a-half page letter distributed by the Bombay stock exchange, Mr. Raju described a small discrepancy that grew beyond his control. “What started as a marginal gap between actual operating profit and the one reflected in the books of accounts continued to grow over the years. It has attained unmanageable proportions as the size of company operations grew,” he wrote. “It was like riding a tiger, not knowing how to get off without being eaten.” <blockquote>Mr. Raju said he had attempted and failed to bridge the gap, including an attempt in December to buy two construction firms in which the company’s founders held stakes. Speaking of a “deep regret” and a “tremendous burden,” Mr. Raju said that neither he nor co-founder and managing director B. Rama Raju had “taken one rupee/dollar from the company.” He said the board had no knowledge of the situation, nor did his or the managing director’s families. </blockquote> The size and scope of the fraud raises questions about regulatory oversight in India and beyond. In addition to India, Satyam has been listed on the New York Stock Exchange since 2001, and on Euronext since January of 2008. The company has been audited by PricewaterhouseCoopers since its listing on the New York Stock exchange. <blockquote>Satyam has been under close scrutiny in recent months, after an October report that the company had been banned from World Bank contracts for installing spy software on some World Bank computers. Satyam denied the accusation but in December, the World Bank confirmed without elaboration on the cause that Satyam had been banned. Also in December, Satyam’s investors revolted after the company proposed buying two firms with ties to Mr. Raju’s sons. On Dec. 30, analysts with Forrester Research warned that corporations that rely on Satyam might ultimately need to stop doing business with the company. “Firms should take the initial steps of reviewing the exit clauses in their current Satyam contracts,” in case management or direction of the company changed, Forrester said. </blockquote> The scandal raised questions over accounting standards in India as a whole, as observers asked whether similar problems might lie buried elsewhere. The risk premium for Indian companies will rise in investors’ eyes, said Nilesh Jasani, India strategist at Credit Suisse. <blockquote>R.K. Gupta, managing director at Taurus Asset Management in New Delhi, told Reuters: “If a company’s chairman himself says they built fictitious assets, who do you believe here?” The fraud has “put a question mark on the entire corporate governance system in India,” he said. </blockquote>News of the scandal — quickly compared to the collapse of Enron — sent jitters through the Indian stock market, and the benchmark Sensex index fell more than 5 percent. Shares in Satyam fell more than 70 percent. Just a few months ago, Mr. Raju was trying to persuade investors that the company was sound. In October, he surprised analysts with better than expected results, saying he was “pleased” that the company had “achieved this in a challenging global macroeconomic environment, and amidst the volatile currency scenario that became reality.” But by late December, it seems he had little support from the board or investors and four of the company’s directors resigned in recent weeks. Satyam recently retained Merrill Lynch for strategic advice, a move that is generally a precursor to a sale. Mr. Raju said in his statement that he “sincerely apologized” to shareholders and employees and asked them to stand by the company. “I am now prepared to subject myself to the laws of the land and face consequences thereof,” he said.

Ramalinga Raju, resigned after revealing that he had systematically falsified accounts

Satyam Computer Services, a leading Indian outsourcing company that serves more than a third of the Fortune 500 companies, significantly in...

$1 billion Miami life insurance fraud

Four men are facing federal charges in a $1 billion Miami life insurance fraud first exposed in 2004.A 25-count grand jury indictment Monday...

guided tour of the sophisticated credit card forgery operation run

Detective Bob Watts of the Newport Beach Police Department takes us on a guided tour of the sophisticated credit card forgery operation run ...

New wave of unwitting victims may emerge from Mr Madoff's investment scheme.

Role of America's federally regulated banks in the $50 billion Bernard Madoff investment scandal has come into question after it emerged that a number of victims of his alleged Ponzi scheme thought they had invested their money with an ordinary bank. Mr Madoff, 70, is alleged almost a month ago to have told his sons Mark and Andrew, who worked for him, that he was “finished” and that their investment firm was a giant Ponzi scheme. He has been charged with securities fraud and is under house arrest and is electronically tagged. <blockquote>Two law firms in Florida, which are gathering claims from Madoff victims, are both representing a couple who say that they believed that they had invested about $1 million (£688,000) with the Westport National Bank, a regulated savings bank in Connecticut, rather than with Mr Madoff. </blockquote> The Florida case raises concern that a new wave of unwitting victims may emerge from Mr Madoff's investment scheme. The FBI and the Securities and Exchange Commission (SEC) are already investigating the role of certain hedge funds that provided Mr Madoff with new clients. The biggest of these is Fairfield Greenwich, a Connecticut hedge fund believed to have lost about half its assets, totalling $7.3 billion, to Mr Madoff's scheme. <blockquote>The Florida couple, whom lawyers declined to name, received a letter from the bank dated December 12, the day that Mr Madoff was charged with fraud, explaining: “You currently have a custodian agreement with Westport National Bank [...] you gave full discretionary authority to Bernard L Madoff Investment Securities.” </blockquote> According to Craig Stein, an attorney with Stein & Pinsky in Boca Raton, Florida, the couple had no inkling of their exposure to Mr Madoff and received annual statements from the bank that showed deductions for custodial and record-keeping fees that added up to 4 per cent a year, or $40,000 at the peak of their investment. Mr Stein said that his clients had been introduced, with other investors in Westport, by a “promoter”. Westport National Bank insists that “the bank has not invested any of its own funds or the funds of its depositors with Madoff, and the bank has not advised any customer of anybody else to invest with Madoff”. The implication is that the investment must have gone via another route, therefore. The Office of the Comptroller of the Currency, America's banking regulator, refused to be comment on whether it was questioning Westport or investigating whether US banks played a role in helping Mr Madoff to create what is described as the world's biggest fraud. The two Florida law firms have also claimed that those eligible to join his fund needed to be far less rich than first believed. When the scandal came to light almost a month ago, it was thought that new clients had to be prepared to invest at least $10 million in order to qualify for their money to be managed by Mr Madoff. However, according to Mr Stein and Adam Rabin, of McCabe Rabin, a law firm in West Palm Beach, Florida, investors were eligible with sums of about $100,000. Both attorneys also said that they had been approached by victims of modest means who had joined Mr Madoff's investment fund by pooling their savings.

New wave of unwitting victims may emerge from Mr Madoff's investment scheme.

Role of America's federally regulated banks in the $50 billion Bernard Madoff investment scandal has come into question after it emerged...

Samata Co-operative bank case investigation the amount involved is likely to snowball to more than Rs 200 crore.

Samata Co-operative bank case investigation the amount involved is likely to snowball to more than Rs 200 crore. State criminal investigation department (CID) is unearthing more stunning facts like even fruit and movie posters being accepted as securities for loans, and insiders siphoning off huge amounts of funds. Seizure of properties, purchased with the illegally procured loans, is also on the cards. Moreover, around six auditors including an internal one and at least 27 more borrowers have been brought under scanner by CID. A source said these borrowers are likely to have siphoned off nearly Rs 103 crore. Several new accounts have been unearthed by the toiling sleuths. “The scam is getting larger from the earlier figure of around Rs 145 crores. Several mind-boggling facts are tumbling out now as CID has began to unearth documents and evidence of fraud which had so far remained hidden,” said Yashasvi Yadav, superintendent of police, state CID. “Names of the borrowers who embezzled huge amounts but were not named in the FIR are surfacing. We suspect auditors too had a role to play, especially after year 2000. The scam was very evident then. The auditors should have pointed out violations of banking rules or RBI guidelines but that was not the case,” said Yadav who has put a team in place to investigate the case minutely.

Samata Co-operative bank case investigation the amount involved is likely to snowball to more than Rs 200 crore.

Samata Co-operative bank case investigation the amount involved is likely to snowball to more than Rs 200 crore. State criminal investigati...

Steven Bartlett was accused of misappropriating close to $1.6 million intended for home construction for his own personal use.

One of the largest homebuilder fraud cases in Florida's history ended in a guilty verdict for Steven Bartlett. Bartlett was accused of misappropriating close to $1.6 million intended for home construction for his own personal use.More than 100 witnesses took the stand and spoke of losing life savings by contracting with Coral Bay Construction to build their home. Bartlett's attorney argued that the homes were going to be built and blamed sloppy bookkeeping for the problems.Jury acquits suspect of DUI manslaughterA jury acquitted Brian Gomes of DUI manslaughter two years after a crash that killed his friend, Marc Collins. Instead, he was found guilty of DUI and driving on a suspended license - essentially for the events leading up to the crash.The verdict surprised many involved in the trial, including the prosecutor, Bill Catto. Catto neglected to include Gomes' driving record - which included three prior DUIs - in the charging information, so the sentence was treated as a first offense. Instead of five years in prison, he was given 11 months in jail.

Steven Bartlett was accused of misappropriating close to $1.6 million intended for home construction for his own personal use.

One of the largest homebuilder fraud cases in Florida's history ended in a guilty verdict for Steven Bartlett. Bartlett was accused of m...