The Criminals at Goldman Sachs

Two former Goldman Sachs bankers were indicted on criminal charges last week.

The details: Tim Leissner, the bank's former chairman of Southeast Asia, has already pleaded guilty. His colleague Roger Ng was arrested in Malaysia and will be extradited to the U.S. Andrea Vella also appears in the complaint, as Co-Conspirator #4. He has been placed on leave by Goldman, just two weeks after becoming the bank's co-chairman of investment banking for Asia, excluding Japan.

Leissner stole money from Malaysia, embezzling development-bank funds for the criminal conspiracy. According to the complaint, "more than $2.7 billion was misappropriated by the defendant Tim Leissner and his co-conspirators." The complaint makes it clear that some of that money ended up going to Leissner personally, over and above his handsome Goldman Sachs bonus checks. read more »

Northrop Grumman Systems Corporation to Pay $27.45 Million to Settle False Claims Act Allegations

The Justice Department announced today that Northrop Grumman Systems Corporation (NGSC) has agreed to settle civil allegations that it violated the False Claims Act (FCA), 31 U.S.C. §3729, by overstating the number of hours its employees worked on two battlefield communications contracts with the United States Air Force.  Under the settlement, NGSC, headquartered in Falls Church, Virginia, will make a payment of $25.8 million, which, combined with earlier repayments, will result in a civil recovery of approximately $27.45 million. read more »

HSBC discloses customer accounts hacked at its U.S. bank

Hackers breached some HSBC customers’ accounts in the United States in October and accessed their information, the bank said in a regulatory filing on Tuesday.

It was not immediately clear how many accounts were breached or whether any money was stolen. read more »

German prosecutors search Blackrock's offices in dividend-stripping probe

German prosecutors searched the Munich offices of fund investor Blackrock on Tuesday as part of a probe into dividend stripping trades, a person with knowledge of the matter told Reuters, as the country’s largest post-war fraud investigation widened

The practice being investigated typically involved trading company shares rapidly around a syndicate of banks, investors and hedge funds to create the impression of numerous owners - each entitled to a tax rebate. read more »

SEC Charges Investment Adviser With Running $3.9 Million Fraud

The Securities and Exchange Commission today charged a former registered representative and investment adviser in Altoona, Pennsylvania, with operating a long-running offering fraud.

The SEC’s complaint alleges that Douglas P. Simanski raised over $3.9 million from approximately 27 of his brokerage customers and investment advisory clients, many of them retired or elderly, by telling them that he would invest their money in either a “tax free” fixed rate investment, a rental car company, or one of two coal mining companies in which Simanski claimed to have an ownership interest.  He allegedly told the investors to write checks payable to personal bank and brokerage accounts he opened in his wife’s name.  The complaint alleges that instead of investing the money as he promised, Simanski largely used the money to repay other investors and for his personal use. read more »