White Collar Crime

Published on: February 7, 2012

SEC Whistleblower Program Results Not Very Promising

by Stephen Bilkis

In July 2010, the Securities and Exchange Commission (SEC) launched a new program for government and corporate sector employees that allowed them to safely provide information about possible fraud and other illegal activities they have witnessed or heard about. This program is part of the financial reform bill passed last year. So far, the new program has received only 168 complaints and tips. This number represents complaints and tips through February 2011, reports a New York Criminal Lawyer. But this number much lower than expected considering other whistleblower groups such as the National Whistleblowers Center and the whistleblower program run by the Department of Justice which receive hundreds of tips and complaints each year.

The National Whistleblowers Center provides informants with legal representation while the Department of Justice offers financial compensation to those that come forward. The SEC also offers financial compensation to those who choose to provide investigators with tips and other information. Informants may earn up to 30% of all monies collected in penalties or lawsuits that total more than 1 million dollars.

Specific rules governing how government and corporate sector employees file a complaint with the SEC may explain why many are hesitant to do so. Many government agencies and companies require employees to first file a complaint or provide tips through internal whistleblower programs first before filing their complaint with the SEC, says a Brooklyn Criminal Lawyer. Employees may be hesitant to file complaints with the SEC if they have to go through several agencies to do so. Filing multiple complaints may jeopardize their careers or create unwanted tension in the workplace.

Published on: January 24, 2012

Former CEO of a Texas-based investment firm indicted on multiple counts of fraud

by Stephen Bilkis

A former CEO of a major financial firm was recently charged with several counts of white collar crimes that included wire fraud, securities fraud and money laundering.

As of February 28, the former Chief Executive Officer of a notable firm situated in Austin, TX was scheduled to be arraigned in a federal district court to hear his multiple charges. A New York Criminal Layer notes that the man is alleged to have fraudulently raised $50 million from investors in a malicious and manipulative scheme that involved money laundering, wire fraud and securities fraud. The allegations go into greater detail by describing the fact that the defendant manipulated contacts from church as well as former NFL football stars to cultivate this scheme, which had the personal enrichment of the defendant as its primary motivating factor.

The Austin-based firm, which specializes in investments, was placed in receivership in 2009 by the judge presiding over the case in its initial development. This event was a result of the sobering fact that the U.S. Securities and Exchange Commission (SEC) took action against the firm by way of a securities lawsuit. Though the defendant and former CEO of the firm is facing a major indictment of 39 counts, A Brooklyn Criminal Lawyer explained that is has not yet been revealed what the outcome of the indictment was. What is known is that, according to authorities, the man did not act merely on his own behalf. It appears that his investment manipulation also benefitted the Chief Financial Officer of the Austin-based firm, who is not named.

Published on: January 20, 2012

Army Crime-Lab Worker Blotched Tests Leaving Many DNA Cases in Doubt

by Stephen Bilkis

Over the past several years, DNA science has made extraordinary progress and its implementation in many criminal cases has both convicted the guilty and exonerated the innocent. A New York Criminal Lawyer has learned that one federal crime lab is struggling to keep its reputation afloat following reports that one of its more senior and experienced forensics examiners not only blotched, DNA tests, but also falsified records.

A worker at the U.S. Army Criminal Investigation Laboratory, near Atlanta, is being investigated for alleged mistakes that may have allowed the guilty to go free and may have contributed to many to be wrongfully convicted of crimes they did not commit, sources tell.

Unfortunately, the problem appears to go much deeper than just one worker that was making mistakes and then attempting to cover them up. Sources alleged to a New York City Criminal Lawyer that the forensic examiner’s supervisors were not only slow to recognize his mistakes, but also wanted to keep any investigation of these mistakes in-house so that the facility would not lose its accreditation.

Published on: January 19, 2012

Car Accident Insurance Frauds Busted

by Stephen Bilkis

It’s always fun until somebody gets busted for alleged insurance fraud. A crew of friends staged a car accident during the summer in NYC, and then attempted to collect on insurance payments. Authorities said some Bronx residents were responsible in a report picked up by a New York Criminal Lawyer. Officials got to the bottom of the caper by viewing surveillance video recorded above the crash site.

Investigators noticed the slow motion appearances the crash had. It didn’t add up for them so they became suspicious and probed further in their investigation. There was even an attempt by one of the drivers involved where they repeated a move to make it look more convincing. All of this was in the recording.

Police told a Bronx Criminal Lawyer that the participants made their cars collide at the scene. Moments later, they reappeared at the same location, following a brief spin around the block. Once they had returned the drivers pretended to back into each other, which caused further damages. The drivers called 911 and filled out false police reports. They even alleged injuries and sought medical treatment at a local Bronx medical facility. The medical facility billed over $30,000 in medical costs in less than a half days’ time.

Published on: January 9, 2012

Barry Bonds Has Murky Legacy in San Francisco

by Stephen Bilkis

Barry Bonds is famed for being the greatest hitter of home runs in baseball history – now he’ll be known for his criminal conviction for obstructing justice, as well.

The jury on the Bonds case was unable to come to a decision regarding whether or not Bonds lied about the use of steroids. Only the obstruction of justice charge stuck, though it is a felony charge, a New York Criminal Lawyer points out. The prosecution wanted all the charges to stick, but Bonds didn’t get what he wanted either – as a convicted felon, he cannot own a firearm, vote, or serve on a jury.

In 2003, Bonds said under oath before a grand jury that he never took performance-enhancing drugs, to his knowledge. What matters most to baseball fans is that he did take them, which makes his otherwise impressive baseball record dubious, at the very least.

Published on: December 5, 2011

Ex-Qwest CEO Says That He Will Not Pay for His Lawyer’s Underwear

by Stephen Bilkis

On Wednesday, the former chief executive officer (CEO) of Qwest Communications, filed a lawsuit that alleges the lawyers who represented him during his insider-trading case overbilled him, a newspaper has learned. The legal malpractice lawsuit was filed in state Superior Court in Newark, NJ, seeks punitive and compensatory damages totaling $25 million plus attorney’s fees.

The former CEO is currently located at a federal prison in Pennsylvania, serving a 70-month sentence for using insider information as a basis for selling $52 million in stock in his former employer, the source was told. An appeals court also ordered him to pay a $19 million fine and to forfeit close to $45 million. His conviction was in 2007.

The former CEO’s current attorney has also informed the source that thanks to the law firm named in the suits failure to follow even the most “basic litigation procedures,” his client received not only strict fines, but also a lengthier prison sentence than what was necessary. The attorney also stated that due to these failures, the trial judge barred the defense’s sole expert witness. He also added that the case is sad, since his client not only received inadequate representation during his trial, but he was also overbilled in the process.

Published on: November 15, 2011

An international case of fraud involving a major software firm leads to high-stakes charges

by Stephen Bilkis

A former manager of a major U.S. software company was recently indicted on charges of wire fraud, suspicion and money laundering, following an investigation which revealed a multi-million dollar international scam.

During the course of his five-year employment with the software company, the defendant appears to have taken kickbacks from foreign suppliers in exchange for insider information and future plans of the company. The co-conspirators included several suppliers from Singapore and China, as well as other partners in Asia. A the defendant is responsible for approximately $2.25 million in lost revenue for the company which he represented. This amount reflects both personal gains that the defendant gleaned from the shady Asian foreign suppliers, as well as damages to the software company he once served as manager. Potentially he can be charged with Grand Larceny wither in State or Federal Court

A New York Criminal Lawyer observes that the defendant, a native of Sunnyvale, CA, was indicted on August 11, 2010. He subsequently entered into a plea deal, the details of which are summed up in an official statement by a representative of the U.S. Department of Justice: “…(the defendant) admitted to engaging in a scheme to defraud (the company) of its money or property and its right to his honest services while he was employed with the company from 2005 through 2010.” Federal agents scoured the defendant’s home following his detailed conviction, where they found approximately $150,000 cash hidden in shoe boxes. This cash was most like part of the kickbacks he received from the Asian-based suppliers, which constituted a certain percentage of the commerce between the plaintiff company and its foreign suppliers.

Published on: November 14, 2011

SEC Accuses Former Goldman Sachs Director of Participating in Insider Trading

by Stephen Bilkis

A former director of financial firm Goldman Sachs has been accused of providing illegal business tips to the head of the Galleon Group, another financial firm. The Securities and Exchange Commission (SEC) alleges that Rajat K. Gupta provided information about Warren Buffet’s intentions to invest in Goldman Sachs to Raj Rajaratnam hours before the investment was complete. This tip allowed the Galleon Group to earn $900,000 in profits after the company purchased 175,000 Goldman Sachs shares. Providing tips like this to other business people is illegal and unethical, and is charectarized as White Collar Crime.

According to the SEC, this is not the first time Gupta has provided Rajaratnam with trading tips. Gupta, who also sits on the board of Proctor and Gamble (P&G) alerted Rajaratnam of the company’s quarterly earnings early which prompted the Galleon Group to purchase shares right before quarterly earnings announcements. The Galleon Group earned more than $13.6 million in profits.

Gupta and Rajaratnam met about ten years ago during their work with the Indian School of Business. Since then, the two men have shared thousands of phone calls, lunches and formed business alliances such as the New Silk Route, a financial firm specializing in investment opportunities in India. Even though Rajaratnam’s role in New Silk Route is unclear, as he never took an active role in the firm, the two men are linked to the company, states a New York Criminal Lawyer. Gupta’s lawyer insists that the two men are friends and business colleagues and that Gupta has 40 years of experience in business and has never been accused of any illegal activities during this time.

Published on: September 28, 2011

Age a factor in sentencing of 72 year old man

by Stephen Bilkis

There is an old saying that “with age comes wisdom”. Apparently, this proverb doesn’t hold true for everyone, according to a New York Criminal Lawyer. Some people seem inclined to stay rooted in their old behavior patterns no matter how devastating they may be, and others pick up proclivities and habits that are not at all becoming as they age. Should an ‘elderly ‘ person be granted leniency for such a crime because of their age?

Take for instance the 72 year old man who was recently sentenced to 3 years in prison for sexually assaulting a 5 year old child in 2006. No one knows for certain if this is a behavior problem that has manifested recently or if he has been carrying it around for decades, but whatever the case, it is unacceptable in our society. Such lascivious behavior should not go unpunished, no matter how old or young the perpetrator, and yet, his lawyers are attempting to keep him out of prison because he is an elder. In The Bronx and Suffolk County, this type of behavior would not be tolerated because of age.

In this case, the man’s defense attorney has requested a suspended sentence for this man because of his age, claims a Queens Sex Crimes Lawyer. The question is, does a man who raped a small child belong on the streets, no matter how old he happens to be? A crime is a crime and this one is particularly distasteful, because it stripped away the innocence of a young child and changed her life forever. Should this man be given a lighter sentence because he has spent more time on this earth? If the old adage were true, that age brings wisdom with it, then this man should have learned a long time ago that sexual assault on a child is not one of the best decisions that he could have made.

Published on: September 2, 2011

Former Teacher Arrested

by Stephen Bilkis

A New York Criminal Lawyer has learned that a former middle school teacher has been arrested by police for improper text messaging a former student and offering to furnish her with alcohol. The 41-year old former teacher now faces the fourth degree felony of contributing to the delinquency of a minor.

The police department has expressed its happiness in getting a child predator off the streets. The text messages and emails the former teacher had sent to the 15-year old girl were very carefully crafted and with the exception of offering the teen alcohol, never included any offers for sex. However, there were some personal compliments included, such as how pretty the girl is, how nice her legs are, and how much he wished he were younger so he could date her. It is unclear as to whether the teenager or her parents notified the police. However, it is at this point that the police did become involved.

The former teacher did not realize that police had begun monitoring the teenager girl’s Facebook account and in reality he was making these comments to them instead of the teen he was seeking her favors. His offers to provide her with alcohol were accepted. When he pulled into a local store parking lot to meet the teen, police were there waiting for him. A search of the vehicle concluded with the discovery of alcohol that he had allegedly brought for the 15-year old girl’s use. In Manhattan and Queens this could easily be considered a sex crime.