Citigroup Says CFTC Investigating Banks Interest-Rate Swaps

Citigroup Inc. said Monday that it is cooperating with an industrywide investigation of interest rate swaps.

The bank said in a quarterly securities filing that the Commodity Futures Trading Commission is investigating "the trading and clearing of interest rate swaps by investment banks."

Interest-rate swaps are derivative contracts that allow two parties to exchange the cash flows associated with a debt instrument. This can change coupon payments from a fixed to a floating rate, or vice versa. They are used extensively by companies to manage their exposure to changes in interest rates and banks often take the other side of these trades. read more »

$5.5 million settlement for Reno energy company accused of boondoggle

Reno geothermal power companies will pay $5.5 million to settle a lawsuit brought by the Department of Justice that they illegally received millions of dollars in clean energy grants, the U.S. Attorney’s Office said.

The government reached the agreement with Ormat Technologies, Inc., and companies Ormat owns. Ormat does not admit liability under terms of the agreement, the U.S. Attorney’s Office statement said.

“Ormat exploited the resources of the United States Government in order to finance one of the most expensive geothermal boondoggles in history, utilizing government money in an attempt to create a false appearance of function and profitability,” the U.S. Attorney’s Office alleged in a May 2014 complaint.

The U.S. Attorney’s Office alleged Ormat misled the government on the dates some projects were put in service, the amount of power produced, the nature and purpose of expansions, the long-term viability of certain geothermal projects and the value of the property on which the government grants were based. 

Fight or settle? Dallas' Trinity Industries taking big chance in court to save face and massive fine

Trinity Industries, which manufactured thousands of miles of guardrails lining U.S. highways, is in a legal war for its financial life and its reputation.

Two years ago, an East Texas jury ruled that the Dallas industrial supply company violated the False Claims Act, a 153-year-old law that allows whistleblowers to sue companies that defraud the U.S. government. The jury found that Trinity failed to inform federal officials that it had modified its highway guardrail systems but kept promoting the product as approved by the Federal Highway Administration.

The verdict resulted in a $663 million judgment against Trinity — the largest in the history of the False Claims Act — and opened the door to a flood of lawsuits that seek billions of dollars in damages against the company. read more »

SEC settles with auditor in NY suburb's bond fraud case

A New York auditor on Monday settled U.S. Securities and Exchange Commission charges that it issued fraudulent audit reports in connection with municipal bond offerings by the town of Ramapo, New York and its local development corporation, which were charged with fraud in April.

The SEC said PKF O'Connor Davies and senior partner Domenick Consolo let Ramapo record in 2009 a $3.08 million receivable in its general fund for the sale of a 13.7-acre property known as the "Hamlets" to the nonprofit Ramapo Local Development Corporation, despite knowing that the sale had not occurred. read more »

Detroit-Area Home Health Care Agency Owner Sentenced to 30 Years in Prison for $33 Million Medicare Fraud Scheme

The owner of several Detroit home health care companies was sentenced today to 360 months in prison for his role in a Medicare fraud scheme that caused approximately $33 million in losses. read more »