Bankrupt Banker

Joseph Thornburgh faces charges of conspiracy to commit mail fraud, wire fraud and money laundering

Joseph Thornburgh faces charges of conspiracy to commit mail fraud, wire fraud and money laundering

Joseph Thornburgh faces charges of conspiracy to commit mail fraud, wire fraud and money laundering.The 60-year-old Thornburgh pleaded not g...

Mark D. Hamburg of Quitman has been arrested for misdemeanor home repair fraud and contracting without a license.

Mark D. Hamburg of Quitman has been arrested for misdemeanor home repair fraud and contracting without a license. An investigation by the Co...

Accounting fraud at its Schenker freight unit in Belgium which amounted to several tens of millions of euros going back several years.

German rail operator Deutsche Bahn [DBN.UL] said on Friday it had discovered an accounting fraud at its Schenker freight unit in Belgium whi...

Joseph Brunson, Tony Pough and Timothy McQueen each were indicted on 12 counts of money laundering and 10 counts of transporting checks

Joseph Brunson, Tony Pough and Timothy McQueen each were indicted on 12 counts of money laundering and 10 counts of transporting checks obtained by fraud. The men who called themselves the "3 Hebrew Boys" previously had been indicted on 35 counts each of federal mail fraud. They still face those charges, as well as state securities fraud charges.Each of the new fraud charges is connected with checks allegedly sent to the men at their offices in Columbia from investors in locations as far away as Pontiac, Mich., according to the indictment. It said the checks ranged from $5,250 to $63,000 each and totaled nearly $200,000.On the money laundering counts, prosecutors list more than a dozen items — from a $180,000 luxury box at a sports arena to a $4.5 million private jet — that they say they men purchased with money from investors.A Sept. 3 arraignment has been scheduled on the new charges, which each carry a penalty of up to 10 years in prison and a $250,000 fine. Each of the mail fraud charges carries the same monetary fine and up to 20 years in prison.Prosecutors say the men, who named their investment plan the "3 Hebrew Boys" after a Bible tale about brothers who kept their faith in God even as they were thrown into a fiery furnace and survived, promised daily returns of up to 500 percent.Authorities said the trio focused on recruiting investors in churches and at military bases, adding some soldiers fighting in Iraq even sent the men checks as word of the plan spread.All told, prosecutors say the men lured at least 7,000 investors from two dozen states, taking $80 million along the way. The three had told people that the money would be invested in foreign currency markets, but investigators have said less than $40,000 was actually invested — and the rest allegedly spent on luxury items for the three defendants.The men, who are representing themselves at trial, and attorneys appointed to act as their legal advisers did not immediately return messages seeking comment on the new charges. A court-appointed receiver has said he had collected more than $18 million in assets to return to investors if the men are found guilty.The men were in court for two separate hearings this week.On Monday, U.S. Magistrate Joseph McCrorey ordered Brunson to undergo a mental evaluation to see if he's competent to stand trial, at one point expressing frustration with Brunson's repeated statements that he was not a defendant and not subject to U.S. laws.Also Monday, U.S. District Judge Margaret Seymour rejected a series of motions by the three men, including requests that the case be dismissed under the argument that the U.S. District Court does not have jurisdiction over the case.

Joseph Brunson, Tony Pough and Timothy McQueen each were indicted on 12 counts of money laundering and 10 counts of transporting checks

Joseph Brunson, Tony Pough and Timothy McQueen each were indicted on 12 counts of money laundering and 10 counts of transporting checks obta...

Richard Pundt was arrested Thursday night on three counts of mail fraud, six counts of wire fraud and one count of conspiracy.

Richard Pundt was arrested Thursday night on three counts of mail fraud, six counts of wire fraud and one count of conspiracy. He appeared i...

Darrell Dickinson submitted false claim information on funeral costs to get money through a program that helps cover such expenses

Authorities say 59-year-old Darrell Dickinson submitted false claim information on funeral costs to get money through a program that helps c...

Alain Gagnon, a federal public servant accused of defrauding the government of $2.4 million has pleaded guilty

Alain Gagnon, a federal public servant accused of defrauding the government of $2.4 million has pleaded guilty to breach of trust by a public officer and fraud over $5,000.The 51-year-old Public Works and Government Services financial officer was arrested in September 2007. Mr. Gagnon was released on $5,000 bail and $15,000 security put up by family.Court documents showed that Mr. Gagnon, who lives in L'Ange-Gardien, used his position to defraud the government for more than a decade starting on Sept. 11, 1996.The RCMP investigation began in July 2007 when the Special Investigations Directorate of Public Works turned the matter over to the Ottawa RCMP Commercial Crime Section. The directorate investigates illegal activity solely within Public Works.About $885,000 of Mr. Gagnon's assets have been seized or frozen since his arrest, including his $400,000 L'Ange-Gardien home, several bank and investment accounts, and seven vehicles.The vehicles included a Toyota Camry, Honda Odyssey Mini Cooper and Toyota Yaris, a snowmobile and ATV, said Crown prosecutor Sylvain Petitclerc.Mr. Gagnon is to be sentenced on Nov. 4.

Alain Gagnon, a federal public servant accused of defrauding the government of $2.4 million has pleaded guilty

Alain Gagnon, a federal public servant accused of defrauding the government of $2.4 million has pleaded guilty to breach of trust by a publi...

Roger Faulkenberry, 47, sentenced executive vice president who raised money from investors at National Century Financial Enterprises, to 10 years

Roger Faulkenberry, 47, sentenced a former executive vice president who raised money from investors at National Century Financial Enterprises, to 10 years in prison.James Dierker, 40, the company's former vice president of client development, received the lightest of four sentences handed down over two days: five years in prison. Marbley and government prosecutors agreed that Dierker was the least culpable of five defendants that went to trial.The four former executives with National Century were convicted in March of defrauding investors over several years. The men said they were innocent and their lawyers argued the government had shown only a fraction of the company's activities in making their fraud case. A fifth defendant, Rebecca Parrett, fled in March while on bond following her conviction and has not been found. The FBI was issued a warrant for her arrest. On Wednesday, Marbley sentenced Randolph Speer, 57, the company's former chief financial officer, to 12 years in prison. Donald Ayers, 72, the company's former chief operating officer, was sentenced to 15 years in prison.Marbley also ordered three of the defendants -- Ayers, Speer and Faulkenberry -- to repay $2.4 billion to investors, or the total amount of money lost through the alleged fraud. The $1.9 billion figure is what the government proved at trial. Dierker must repay $48 million, the amount of money lost by the companies he dealt with.Lance Poulsen, the company's founder and chief executive officer, faces his own trial in October. On Friday, he is scheduled to be sentenced for his March conviction on charges he tried to bribe a witness.National Century was a health care financing company based in suburban Columbus. Prosecutors said executives authorized millions in unsecured loans to the health care providers, then misled investors about the loans.As the money owed to the company mounted, National Century declared bankruptcy in November 2002.National Century offered financing to small hospitals, nursing homes and other health care providers by purchasing their accounts receivable, usually for 80 or 90 cents on the dollar, so the providers wouldn't have to wait for insurance payments. National Century then collected the full amount of the payments.

Roger Faulkenberry, 47, sentenced executive vice president who raised money from investors at National Century Financial Enterprises, to 10 years

Roger Faulkenberry, 47, sentenced a former executive vice president who raised money from investors at National Century Financial Enterprise...

Benitez brothers were masters of Medicare fraud

Benitez brothers were masters of Medicare fraud, prosecutors say.They spent their Medicare millions on Mediterranean-style homes, apartments, hotels, boats, a helicopter, even a water park -- all in the resort area of Bavaro, Dominican Republic, court records show.After they were indicted on fraud charges in late May, Carlos, Jose and Luis Benitez used their Cuban passports to travel from Miami to the Dominican Republic, then to Cuba.The three brothers are accused of defrauding the U.S. government's health insurance program by billing $110 million in false claims for HIV drug-infusion treatments at their dozen Miami-Dade clinics. Medicare paid their companies about $84 million in reimbursements between 2001 and 2004, according to federal authorities and court records.The Benitezes -- who came to this country in 1995 and became U.S. citizens five years later -- have a lot of company. They are among 56 fugitives charged since 2004 with filing at least $272 million in phony Medicare claims before disappearing from Miami-Dade. Collectively, the fugitives absconded with at least $142 million in taxpayer funds. Thirty-three of the 36 fugitives whose names have been released by authorities are Cuban immigrants, most of whom came to the United States during the past 15 years, according to FBI, immigration and court records obtained by The Miami Herald. Half of those fugitives have fled to Cuba, according to the FBI, which based its information on travel, customs, passports, bank and computer records. The majority of some 700 Medicare fraud defendants charged since 2004 are immigrants who share an implicit trust when they join small criminal enterprises in South Florida to defraud the government program, according to perpetrators, prosecutors and investigators.Timothy Delaney, assistant special agent in charge of the FBI's office in Miami, said Medicare fraud has spread over the past decade in certain pockets of South Florida's population of 750,000 Cuban Americans -- just as it has in heavily populated immigrant communities in other major cities.Medicare is seen as an easy mark for fraud because it is built on an honor system that pays claims quickly with scant review. Also, the odds of getting caught are low and the odds of making millions are high.Delaney said certain segments of Cuban immigrants in Miami and Hialeah -- just like Armenians in Los Angeles, West Africans in Houston and Russians in New York -- trust one another to form mini-rackets. ''We have unscrupulous providers, willing doctors and willing practitioners,'' said Delaney. ``They don't think they've committed a crime.'' Among the known Medicare fugitives who fled to Cuba: Eduardo Moreno, who came to the United States in 1997.Moreno, 39, used a network of offices to operate medical equipment and HIV drug-infusion scams totaling $7.2 million in false Medicare claims, according to federal court records. He bought himself a $445,000 southwest Miami-Dade home and a $200,000 Rolls-Royce Phantom.When the FBI arrested him last year on fraud charges, he made a $250,000 bond, then skipped the country -- back to Havana, according to the FBI. Agents tracked him through his travel records and his relatives.Moreno is among at least 18 identified fugitives suspected of fleeing to Cuba -- with another 18 escaping to other parts of Latin America, Europe, Canada, Florida or unknown locations, according to the FBI's account of travel records and other information.In addition, there are 20 unidentified fugitives whose names remain under seal until their arrests.''A good number of them are Cuban and they will return to Cuba, where, as you know, there is no extradition policy and we have no way to get them back at this point,'' said Delaney, who headed the FBI's national healthcare fraud program before transferring to Miami in 2005.U.S. Sen. Mel Martinez, R-Florida, a Pedro Pan Cuban exile who benefited like thousands of others from the Cuban Adjustment Act, is pushing legislation in Congress to double the criminal and civil penalties for Medicare fraud offenders. While Martinez said he didn't think Medicare fraud was strictly a ''Cuban issue,'' he also condemned the Cuban government for harboring the fugitives.''My first thought is, it's one more reason why the Cuban government is an outlaw state because it allows fugitives of justice to find refuge there,'' Martinez said.Cuban leaders Fidel Castro and his brother Raul Castro have rarely turned over fugitives of any kind. Tracking down Medicare fugitives in countries such as the Dominican Republic, however, can be successful because they have extradition agreements with the United States. Federal authorities are working with the Dominican Republic to pursue the Benitez brothers and seize their extensive assets in Bavaro -- including a hotel called Cabañas Singapur.Other assets include more tourist hotels, a Robinson R44 Raven helicopter, apartment complexes, luxury homes, supermarkets and a rental car agency -- registered under shell companies or straw names. Dominican officials started seizing properties and freezing their bank accounts in July in cooperation with the U.S. government, which plans to return the proceeds to Medicare.On Friday, Justice Department prosecutors filed a proposed restraining order in federal court in Miami to ensure the Benitez brothers' assets are not sold or transferred to other parties.The Benitez brothers' fugitive case has made headlines in the Dominican Republic not only because of the U.S. government's pursuit of their ill-gotten gains. Over the Fourth of July weekend, Carlos Benitez's daughter and son-in-law -- Yanelkis Benitez Ramirez and Lenin Linares Guerrero -- were kidnapped. Days later, Dominican authorities rescued the couple.Meanwhile, FBI agents have traced the Benitez brothers to Havana, according to federal authorities.In general, the FBI has had little luck capturing Medicare fugitives abroad in recent years. ''We've had no one returned on a healthcare fraud warrant that I'm aware of,'' Delaney said. The one exception: In June 2004, authorities in the Dominican Republic turned over three Medicare fugitives -- Ruben Martinez; his daughter, Adriana Ramos, and her husband, Daniel Ramos -- who had fled to that country months before their indictment on fraud charges.They were part of a Miami-Dade family racket headed by Martinez, 57, that was eventually convicted of bilking $14.5 million from Medicare by charging for bogus medical equipment orders such as hospital beds, oxygen tanks and foot arch supports in 2000-02. Federal authorities recovered $1 million from Dominican bank accounts, $900,000 from U.S. banks, real estate, jewelry and a Porsche Boxster. ''It was a classic case of international cooperation,'' said former federal prosecutor Wifredo Ferrer, the lead attorney in the prosecution of Martinez and 11 others. ``The three fugitives were Cuban nationals, not citizens of the Dominican Republic. The Dominican authorities deemed them persona non grata and expelled them to the United States.''

Benitez brothers were masters of Medicare fraud

Benitez brothers were masters of Medicare fraud, prosecutors say.They spent their Medicare millions on Mediterranean-style homes, apartments...

Albert Gonzalez has been charged along with 10 others with breaking into the computer systems of nine of the nation's largest retail companies

Albert Gonzalez, 27, who is single and lives with his parents in a modest three-bedroom home in Miami, has been charged along with 10 others with breaking into the computer systems of nine of the nation's largest retail companies and stealing more than 40 million credit and debit card numbers.He is being held without bail in Central Islip in another computer fraud case involving a Dave & Buster's restaurant. The companies targeted by what authorities described as "a sophisticated scheme" were Barnes & Noble, BJ's Wholesale Club, Boston Market, DSW, Forever 21, Office Max, the Sports Authority and TJX Cos., the parent company of TJMaxx and Marshall's. Prosecutors say Gonzalez and the other defendants drove around searching for holes in retailers' wireless networks. They then installed "sniffer" programs within the networks that gathered card numbers as well as password and account information. Some of those numbers were sold to other criminals here and in Eastern Europe. Prosecutors say the defendants also used the numbers to withdraw tens of thousands of dollars from automated teller machines."He is a master in the field of computers," said one person familiar with the self-taught Gonzalez and the three-year investigation into the case. Gonzalez allegedly worked as an informant while also tipping the alleged ring, a source familiar with the case said. Informants by their very nature are part of the criminal underworld and have to be handled very carefully, the source said. Secret Service spokesman Malcolm Wiley said yesterday that as soon as the agency became aware of Gonzalez's double role, it dropped him as an informant and began investigating him. Without going into details, the indictment says that Gonzalez got information while working as an informant, which he passed on to fellow hackers to prevent them from being identified by authorities.Gonzalez's attorney, Rene Palomino of Miami, scoffed at the indictment alleging computer fraud, wire fraud, access device fraud, aggravated identity theft and conspiracy. In a telephone interview yesterday, Palomino said that his client was innocent and that the government faced "substantial challenges" in proving its case. Gonzalez began working as an informant for the Secret Service in 2003, after he was arrested in New Jersey on fraud charges, according to court papers. Secret Service director Mark Sullivan has credited Gonzalez with helping the agency break up a major hacking operation. "That was the first time ever that a computer system was wiretapped," Sullivan said, referring to the 2004 takedown of the leaders of a message board used by hackers and credit-card scam artists around the world to buy and sell stolen information. But sources said that when agents discovered that Gonzalez was tipping off some members of his massive hacking operation to the government's investigation, the resulting probe initially led to his May indictment in federal court in Central Islip. Gonzalez was charged then with illegally obtaining the credit card information of 5,000 customers at the Dave & Buster's restaurant in Islandia. He pleaded not guilty.Brooklyn attorney George Farkas, who handled Gonzalez's Central Islip court hearings, declined to comment yesterday.

Albert Gonzalez has been charged along with 10 others with breaking into the computer systems of nine of the nation's largest retail companies

Albert Gonzalez, 27, who is single and lives with his parents in a modest three-bedroom home in Miami, has been charged along with 10 others...

Samuel Israel III ,aka Sam Ryan or David S. Clapp.wanted

<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUKiO7gMuDWoJdiK4NsfklwNUPLGBU-jDiBSc2QGGY64holFVIVc6nLhf-UCn9QoV85JDdwJYodDGkhQGQGP5r3C89b__ZapgYiggVoz87w_XngslD8zrwciL56IqI4z1NiXdGSSWrilAz/s1600-h/40241850.jpg"><img alt="" border="0" id="BLOGGER_PHOTO_ID_5231687873686504786" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgUKiO7gMuDWoJdiK4NsfklwNUPLGBU-jDiBSc2QGGY64holFVIVc6nLhf-UCn9QoV85JDdwJYodDGkhQGQGP5r3C89b__ZapgYiggVoz87w_XngslD8zrwciL56IqI4z1NiXdGSSWrilAz/s400/40241850.jpg" style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;" /></a> Israel, 48, told the judge that the idea of spending 20 years in prison was so distasteful he had considered suicide. But he eventually decided: "I have to take responsibility for my actions no matter what the consequences."That sentiment didn't last long. Within two months, federal investigators said, Israel settled on life as a fugitive. On the day he was to surrender, authorities said, he abandoned his sport utility vehicle on a bridge in the New York City suburbs, scratched "Suicide is Painless" in the dust on the hood to make it seem he had jumped, and skedaddled. On Thursday, 10 days later, agents got their first big break when Debra Ryan, the girlfriend Israel left behind, told them she had helped him pack a recreational vehicle with his belongings and a motor scooter. Ryan was arrested and charged with helping Israel escape. Authorities released a photo of the RV and its license plate number, and said Israel might be spotted at campgrounds or highway rest areas, possibly using the names Sam Ryan or David S. Clapp.Skepticism about his "suicide" started almost as soon as state police determined the vehicle belonged to Israel. When no body was found beneath the 150-foot-high bridge over the Hudson River, authorities said they suspected a ruse. So did investors who were hoping to get some of their money back. "This is a very smart guy, a very crafty guy who was able to steal a lot of money from other smart people," said Ross Intelisano, an attorney for 20 investors in Israel's Bayou Group funds. "My gut tells me he's not the type to jump off a bridge." Within a week, the search for a body was called off, and Israel was officially declared a fugitive. A "wanted" poster and other bulletins revealed his Social Security number, his bird tattoo and his aliases: Sam Ryan and David S. Clapp. Israel's girlfriend at first told police that he left their Armonk house June 9 to drive to prison. He'd been expected at a federal penitentiary in Massachusetts for inmates with special health care needs.After Israel stopped on Bear Mountain Bridge, near West Point about 40 miles north of New York City, surveillance video showed a second car slowly pass his SUV and stop. Agents were hoping to enhance the images to find out what happened next. Federal officials refused to confirm reports that the driver of the second car has been questioned.They also won't go into detail about the search for Israel. But a former federal prosecutor said fugitives who carefully plan their getaways often leave clues behind."You have to be very thorough, very meticulous in setting up your escape," said Lawrence Barcella Jr., who is now a defense attorney specializing in white-collar crime. "But it's hard to do that without leaving some hint, some trail, about your thought process or even your destination."If he went online to find out about a place, if he called there on a cell phone, they can find that out. The advances in technology and all the security upgrades since 9/11 have made it much easier to track someone down," he said. He said falsified travel documents would be available to someone with money, "but again, the government is much more sensitive to that now and much more sophisticated in the detection of that."It's much harder to leave the country now than it used to be."Agents will also apply old-fashioned pressure, potentially including threats of prosecution, to Israel's friends and associates, as they already have to the girlfriend."You know what they say, 'We have ways of making you talk,'" the former prosecutor said.Wherever he is, Israel probably won't be able to resume a life of conspicuous consumption if he wants to evade detection. "You have to tone it down," Barcella said. "The more you spend, the easier you are to find. You also have to cut yourself off completely from your past. That means putting the people and places you love behind you."It takes a level of mental discipline. You can't even engage in those things that are familiar. "If you love to go kayaking, you may not want to go kayaking because that's a profile the feds are going to have," Barcella said. Hiding out might also be complicated by Israel's medical needs. He's had nine back surgeries, wears a pacemaker and is addicted to painkillers, according to prosecutors.Another path Israel could take is to settle in a country that does not have an extradition treaty with the United States.He could also flee to a place that is ill-equipped to deal with such a legal case or somewhere that might welcome his money.Jacob "Kobi" Alexander, who is accused of pocketing millions of dollars while manipulating stock options as chief executive of Comverse Technology Inc., has been living openly in Namibia with his family for two years. "Of course, Namibia's in the African desert," Barcella said. "It's not the Costa del Sol. On the other hand, it's not the federal penitentiary, either

Samuel Israel III ,aka Sam Ryan or David S. Clapp.wanted

Israel, 48, told the judge that the idea of spending 20 years in prison was so distasteful he had considered suicide. But he eventually deci...

Stephen Carver and Khaleeq Ur-Ehman 'Crash for Cash' car insurance scam - one of the first cases of its kind prosecuted in the UK.

Gang who conned insurance companies out of thousands of pounds by staging car crashes have been sentenced to a total of 10 years imprisonment. Thirteen defendents were sentenced at St Albans Crown Court today following a two-year investigation by Hertfordshire’s Serious and Organised Crime Group into the 'Crash for Cash' car insurance scam - one of the first cases of its kind prosecuted in the UK. The investigation, codenamed Operation Mysterious, revealed the gang was making dishonest claims to insurance companies for compensation totalling more than £250,000 relating to road traffic collisions that had never happened. Among the defendants facing charges of conspiracy to defraud was 37-year-old Stephen Carver of Lark Rise, Hatfield who was given a twenty-week suspended sentence and Khaleeq Ur-Ehman, 30, of Milford Close, St Albans who was given a six-month suspended sentence. Upon sentencing, Judge Martin Griffith said these were serious offences which impacted on everyone as this type of criminality causes insurance premiums to be raised. He added that their activities required significant planning and were only detected due to the facilities available to the prosecuting agencies in this case. Speaking after the hearing, Detective Constable Julian Griffiths, who worked on Operation Mysterious, said: “This outcome sends out a clear message to fraudsters that their activities will be uncovered by the police and specialist agencies. With support from the Crown Prosecution Service, the constabulary has also been able to restrain more than £1 million in assets from those convicted with a view to securing confiscation under the Proceeds of Crime Act. This legislation enables us to hit criminals where it hurts – in their pockets.”

Stephen Carver and Khaleeq Ur-Ehman 'Crash for Cash' car insurance scam - one of the first cases of its kind prosecuted in the UK.

Gang who conned insurance companies out of thousands of pounds by staging car crashes have been sentenced to a total of 10 years imprisonmen...

Six men have been sentenced for their involvement in a $3.5 million central Ohio fraud and theft ring.

Six men have been sentenced for their involvement in a $3.5 million central Ohio fraud and theft ring. The ongoing investigation began after a suspicious insurance claim was submitted in January 2006. The Ohio Department of Insurance, Fairfield County Sheriff's and Prosecutor's Office and the National Insurance Crime Bureau have all been involved in the investigation. Ohio Department of Insurance spokesperson Robert Denhard says charges involve falsifying mortgage and vehicle loan documents to fraudulently obtained financing, theft of vehicles and equipment, money laundering and tax evasion. "This team of people would go in and they would falsify documentation to secure lending from different financial institutions and at the end of the day none of the information was factual and true," Denhard said. Six people were sentenced in the Fairfield County Common Pleas Court with sentences ranging from 30 days to four years in prison. A bill of information has been filed against another suspect, two others have trials scheduled for September.

Six men have been sentenced for their involvement in a $3.5 million central Ohio fraud and theft ring.

Six men have been sentenced for their involvement in a $3.5 million central Ohio fraud and theft ring. The ongoing investigation began after...

largest US bank accused of having "repeatedly and persistently committed fraud" by falsely representing to customers that auction-rate debt was safe

In a letter on Friday to Citigroup, David Markowitz, chief of the state's investor protection bureau, accused the largest US bank of having "repeatedly and persistently committed fraud" by falsely representing to customers that auction-rate debt was safe, liquid and the equivalent of cash.He said Citigroup destroyed tapes of phone calls on auction-rate debt that were subject to an April 14 subpoena. The bank learned in mid-June about the tapes, but failed to tell Mr Cuomo's office until June 30, the letter said. Citigroup said in a statement that recycling tapes was generally its practice. It had inadvertently recycled a tape subject to the subpoena, but as soon as it learned of this, had stopped recycling tapes. "We reported this oversight to the regulators, and we have fully co-operated with them in all aspects of this investigation," it said.Any settlement of the five-month investigation would require the New York-based Citigroup to buy back the affected debt at face value, pay damages to investors, and incur a "significant penalty", the letter to the bank said. Mr Cuomo sued UBS on July 24 over auction-rate securities, accusing the Swiss bank of a "multibillion dollar fraud" in steering customers into the debt.Auction-rate securities have rates that set periodically. The market was once considered safe, but part of it remains frozen after a February meltdown in which brokerages abandoned their role as buyers of last resort. Citigroup said in the statement that it had acted in the best interests of clients before and since auctions began to fail. Regulators across the US are examining auction-rate sales practices at other companies, including Bank of America and Merrill Lynch.Earlier on Friday, Citigroup said in its quarterly report that the US Securities and Exchange Commission has opened a formal probe into the sale of auction-rate securities. It said it also was responding to subpoenas from Massachusetts and Texas over the securities.Citigroup spokeswoman Christina Pretto said the bank had been working with issuers, investors and regulators to create liquidity for holders of illiquid auction-rate debt.

largest US bank accused of having "repeatedly and persistently committed fraud" by falsely representing to customers that auction-rate debt was safe

In a letter on Friday to Citigroup, David Markowitz, chief of the state's investor protection bureau, accused the largest US bank of hav...

Order against The Mortgage Specialists Inc. of New Hampshire was taken after examinations by the Division of Banks

order against The Mortgage Specialists Inc. of New Hampshire was taken after examinations by the Division of Banks revealed it had knowingly...

three owners of Internet currency service e-gold have pled guilty to money laundering in the U.S. District Court

The three owners of Internet currency service e-gold have pled guilty to money laundering in the U.S. District Court for D.C.. The service i...

Citigroup Inc, accused the bank of fraudulently selling auction-rate securities and destroying documents that had been subpoenaed by the state.

The office New York Attorney General Andrew Cuomo said on Friday it planned to bring legal action against Citigroup Inc, accusing the bank o...

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...