Fraud

April 27, 2009 -- WASHINGTON - A federal grand jury has indicted four defendants, and an information has been filed against a fifth defendant, for their participation in a massive mortgage fraud scheme that allegedly promised to pay off homeowners’ mortgages on their "Dream Homes," but left them to fend for themselves, Assistant Attorney General of the Criminal Division Lanny A. Breuer and U.S. Attorney for the District of Maryland Rod J. Rosenstein announced today.

The indictment was returned on April 22, 2009, and unsealed today.    » read more »

Virginia Harbor Services Inc. of Clearbrook, Va., and Trelleborg Industrie S.A.S. of France Agree to Plead Guilty

April 20, 2009 -- WASHINGTON — Two subsidiaries of the Swedish company Trelleborg AB, one based in Virginia and the other in France, have agreed to plead guilty and pay a total of $11 million in criminal fines for their participation in separate conspiracies affecting the sales of marine products sold in the United States and elsewhere, the Department of Justice announced today.    » read more »

April 13, 2009 -- WASHINGTON - The Department of Justice Tax Division today announced highlights of its work during the past year to defend and enforce the nation’s tax laws.

The Tax Division has assisted the Internal Revenue Service (IRS) in tracking down tax cheats who use offshore accounts, combating abusive tax shelters, stopping tax defiers and shutting down tax schemes and scams. During FY 2008, the Tax Division also successfully defended refund suits against the United States representing claims of nearly $803 million, and collected, through affirmative litigation, over $178 million. The Division’s budget in that period was less than $93 million.    » read more »

Civil Enforcement Cases, State Enforcement Actions, Alert to Financial Institutions Among New Efforts to Protect American Homeowners Seeking Relief

WASHINGTON, DC, April 6, 2009 -- As homeowners and communities throughout the country continue to face devastating consequences from the deep contraction in the economy and the housing market, the Obama Administration today announced a new coordinated effort across federal and state government and the private sector to target mortgage loan modification fraud and foreclosure rescue scams that threaten to hurt American homeowners and prevent them from getting the help they need during these challenging times.    » read more »

Washington, D.C., March 26, 2009 — The Securities and Exchange Commission has obtained an emergency court order halting a $68 million Ponzi scheme involving the sale of fictitious high-yield certificates of deposit (CDs) by Caribbean-based Millennium Bank.    » read more »

Washington, D.C., March 25, 2009 — The Securities and Exchange Commission has obtained an emergency court order freezing the assets of a Chicago-area investment adviser and two of its principals who are alleged to have misappropriated more than $4 million in client assets by transferring them to third parties, and incorrectly reported the net asset and other investment values to investors.    » read more »

March 25, 2009 -- WASHINGTON —Sikorsky Aircraft Company, a division of United Technologies Corporation, has agreed to pay the United States $2,941,000 to resolve fraud allegations in connection with its contract for the manufacture of Black Hawk helicopters for the Army, the Justice Department announced today.    » read more »

March 24, 2009 -- WASHINGTON - Edward B. Bartoli, a Clearwater, Fla., resident and former attorney, was sentenced to 10 years in prison by U.S. District Judge Charles R. Norgle of Chicago, the Justice Department and Internal Revenue Service (IRS) announced today.

Bartoli is the last of six defendants to be sentenced after they were convicted of various tax crimes in May 2008. Prior to his conviction, Bartoli was a founder of Aegis and its legal director. Bartoli and his co-defendants were found to have carried out a nearly decade-long scheme to market and sell sham domestic and foreign trusts through the Aegis Company to some 650 wealthy taxpayer clients.    » read more »

March 23, 2009 -- HARRISBURG – Pennsylvania Governor Edward G. Rendell’s office today released the Governor’s letter to Mitchell Rubin. The text is as follows:

Dear Mr. Rubin:

I am in receipt of your letter of March 21st in which you indicated you are taking a leave of absence from your duties as a Commissioner of the Pennsylvania Turnpike Commission.

However, I am, effective today, removing you as a Commissioner. I do so for the following reasons:

1) You have received a target letter from federal authorities for your conduct delineated in the recent trial of United States v. Fumo;    » read more »

Washington, D.C., March 19, 2009 — The Securities and Exchange Commission today charged New York's former Deputy Comptroller and a top political advisor for extracting millions of dollars in kickbacks from investment management firms seeking to manage the assets of New York's largest pension fund.

The SEC's complaint alleges that Henry "Hank" Morris, the top political advisor and chief fundraiser for former New York State Comptroller Alan Hevesi, and David Loglisci, former Deputy Comptroller and Chief Investment Officer of the New York State Common Retirement Fund, orchestrated a fraudulent scheme from 2003 through late 2006 that corrupted the integrity of the New York State Common Retirement Fund in order to enrich Morris as well as others with close ties to Morris and Loglisci.    » read more »

Washington, D.C., March 18, 2009 — The Securities and Exchange Commission today charged the auditors of Bernard Madoff's broker-dealer firm with committing securities fraud by representing that they had conducted legitimate audits, when in fact they had not.

In its complaint filed in federal court in Manhattan, the SEC alleges that from 1991 through 2008, certified public accountant David G. Friehling and his firm, Friehling & Horowitz, CPAs, P.C. (F&H), purported to audit financial statements and disclosures of Bernard L. Madoff Investment Securities LLC (BMIS). The SEC previously charged Madoff and BMIS with committing securities fraud through a multi-billion dollar Ponzi scheme perpetrated on advisory and brokerage customers of his firm.    » read more »

Income Data Provided by IRS Will be Used by USDA to Validate Payment Eligibility

WASHINGTON, March 19, 2009 - In response to the discovery of nearly $50 million in payments to ineligible farmers, Agriculture Secretary Tom Vilsack today announced that the U.S. Department of Agriculture (USDA) and Internal Revenue Service (IRS) have begun efforts to ensure that high-income individuals and entities who request USDA payments meet income limits set forth in the 2008 Farm Bill.    » read more »

Eight-count complaint charges company misrepresentations led to state losing millions on stock investments in 2008; "With this suit we intend to hold Lehman executives and directors accountable for the fraud and misrepresentation that caused more than $100 million in losses to New Jersey's pension funds," Governor Corzine said

March 17, 2009 -- The Office of New Jersey Attorney General Anne Milgram filed the lawsuit in Superior Court in Mercer County. It sets forth violations of New Jersey and federal securities laws, negligent misrepresentation, breach of fiduciary duty, fraud, and aiding and abetting. It seeks to recover compensatory and punitive damages.    » read more »

March 11, 2009 -- Washington D.C. -- NEIL M. BAROFSKY, the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), announced today, in coordination with the Inspector General for the Board of Governors of the Federal Reserve System (FRB-OIG), the formation of a broad, multi-agency task force designed to deter, detect and investigate instances of fraud in the soon-to-be-launched Term Asset-Backed Securities Loan Facility (TALF) program.    » read more »

Mar. 12, 2009 -- Lev L. Dassin, the Acting U.S. Attorney for the Southern District of New York, Joseph M. Demarest Jr., the Assistant Director-in-Charge of the New York Field Office of the FBI, and Alan D. Lebowitz, the Deputy Assistant Secretary of the U.S. Department of Labor, Employee Benefits Security Administration (DOL-EBSA), today announced that Bernard L. Madoff pleaded guilty in Manhattan federal court to 11 felony counts related to a massive Ponzi scheme.

Madoff pleaded guilty before U.S. District Judge Denny Chin to securities fraud, investment adviser fraud, mail fraud, wire fraud, three counts of money laundering, false statements, perjury, false filings with the U.S. Securities and Exchange Commission (SEC), and theft from an employee benefit plan.    » read more »