Recent Cases in Financial and Investment Fraud
Fraud in the financial sector is one of the most prevalent types of fraud in the news headlines. Everyone has heard of Bernie Madoff, but it neither started nor stopped with Bernie Madoff. Here are the headlines from just the past few weeks:
- a leading international bank agreed to pay $1.575 billion to end a securities fraud class action, which alleged false and misleading statements about financial results and lending practices.
- a major pharmaceutical company paid $54 million to settle civil charges that it paid illegal kickbacks to induce doctors to prescribe certain of its products.
- Director at a major international bank pled guilty to insider trading -- he tipped a friend to mergers the bank was working on.
- Former executive at a New York investment bank pled guilty to defrauding investors of $38 million, having set up sham private equity investments, fictional financiers, fake email addresses, etc.
- a French tycoon is convicted of a $314 million carbon tax fraud, involving phony offshore companies, straw managers, etc.
- three derivatives traders were convicted of fraudulently manipulating LIBOR, a global interest rate benchmark.
- an Israeli business mogul was found guilty of manipulating the share price of his conglomerate to help a stock offering, after his business empire turned sour.
- the former head of the energy group of a major investment bank pled guilty to a years-long scheme to avoid $45 million in taxes.
- a major bank was relegated to “unsecured creditor” status, where it loaned $312 million to a Chicago money management firm, which then allegedly used the loan to fund a “house” trading account filled with risky and illiquid securities, which contributed to the bankruptcy and insolvency of the money management firm.
- several individuals were convicted of conspiracy to defraud and mislead investors by setting up a $8.2 billion scheme to bolster an Irish bank’s balance sheet during the financial crisis.
This list is but a small sample of the most recent news items about fraud in the financial and investment sector. This type of conduct continues to occur on a daily basis, even though the consequences of the conduct can be severe.
Topics: Investment / Securities Fraud