In Venezuela, Goldman Sachs Found a Hot Deal and a Moral Mess

If a deal looks too good to be true, it may just be. Money managers at Goldman Sachs bought $2.8 billion face value of Petroleos de Venezuela bonds at a deep discount last week, attracting the ire of critics of President Nicolás Maduro. Investments aren’t necessarily moral choices, but they can hit reputations.

Venezuela could, on paper, be one of the soundest emerging-market credits, given that it has the world’s largest oil and gas reserves. But the economy has been in precipitous decline since Mr. Maduro succeeded Hugo Chávez in 2013. Output has fallen by nearly a third over the past three years, and inflation is projected to exceed 1,000 percent by the end of this year, according to the International Monetary Fund. Bare shelves and angry protests met with violence have become the norm.

The country’s opposition is angry that Goldman has, in effect, made life easier for the central bank — the previous owner of the state-controlled Petroleos de Venezuela bonds — thereby propping up Mr. Maduro’s regime. The Wall Street firm, however, says it bought the block of bonds, priced at about 31 cents on the dollar, through a broker and did not interact directly with the government. read more »

The Rise of Cryptocurrency Ponzi Schemes

Scammers are making big money off people who want in on the latest digital gold rush but don’t understand how the technology works.

Last month, the technology developer Gnosis sold $12.5 million worth of “GNO,” its in-house digital currency, in 12 minutes. The April 24 sale, intended to fund development of an advanced prediction market, got admiring coverage from Forbes and The Wall Street Journal. On the same day, in an exurb of Mumbai, a company called OneCoin was in the midst of a sales pitch for its own digital currency when financial enforcement officers raided the meeting, jailing 18 OneCoin representatives and ultimately seizing more than $2 million in investor funds. Multiple national authorities have now described OneCoin, which pitched itself as the next Bitcoin, as a Ponzi scheme; by the time of the Mumbai bust, it had already moved at least $350 million in allegedly scammed funds through a payment processor in Germany.

These two projects—one trumpeted as an innovative success, the other targeted as a criminal conspiracy—claimed to be doing essentially the same thing. read more »

'Hamilton' redux: New York man charged in $70 mln ticket scheme

A New York man has been criminally charged with running a $70 million Ponzi scheme centered on the fake resale of tickets to events including football's Super Bowl, soccer's World Cup, the U.S. Open tennis tournament and the Broadway musical "Hamilton."

The arrest of Jason Nissen, 44, of Roslyn, on Long Island, came 14 years after he was caught selling tickets to students for a Dave Matthews Band concert at the Queens, New York high school where he then taught math. The concert was actually free.

Nissen's case is the second since January alleging that investors were defrauded over ticket sales to "Hamilton" and other popular events.

Prosecutors said Nissen, the chief executive of New York-based National Event Co, lured investors since 2015 by promising to buy and resell tickets profitably.

They said he diverted much of the money to enrich himself and repay earlier investors, using falsified documents and inflated accounts receivable ledgers, with the help of Photoshop, to conceal his fraud. read more »

Exxon Investors to Company: Make Climate Curb Fallout Public

Exxon Mobil Corp. investors, in a split with the company, urged the explorer to publish a detailed analysis on how carbon curbs could affect the value of its oil fields, refineries and pipelines.

The non-binding measure, backed by shareholders including the California Public Employees’ Retirement System and the Church of England investment fund, comes amid reports President Donald Trump may soon abandon the 2015 Paris Climate Accord. More than 60 percent of voters approved the resolution during Exxon’s annual general meeting in Dallas on Wednesday. read more »

Ohio attorney general sues 5 pharma companies over their role in the opioid epidemic

Ohio Attorney General Mike DeWine is suing five makers of opioid painkillers for their role in the state's opioid epidemic.

The suit, which DeWine said is the second by a U.S. state, after Mississippi, claims the drugmakers violated multiple state laws, including the Ohio Corrupt Practices Act, and committed Medicaid fraud.

Purdue Pharma, Johnson & Johnson and its Janssen Pharmaceuticals unit, Teva Pharmaceuticals and its Cephalon unit, Endo Health Solutions and Allergan are all named in the suit.

"In 2014 alone, pharmaceutical companies spent $168 million through sales reps peddling prescription opioids to win over doctors with smooth pitches and glossy brochures that downplayed the risks" of the medicines," DeWine said at a press conference Wednesday. Last year, he said, 2.3 million people in Ohio, or about a fifth of the state's population, were prescribed opioids. read more »

U.S. Attorney's Office of Vermont nabs its largest settlement: $155M

The U.S. Attorney's Office for the District of Vermont announced Wednesday a $155 million settlement with electronic health record vendor eClinicalWorks — the largest in the district's history.

The settlement comes as a result of a lawsuit filed under the False Claims Act alleging the company misrepresented the capabilities of its software by falsely obtaining certification. It also resolves allegations that the Westborough, Massachusetts-based vendor paid kickbacks to certain customers for promoting its product, the U.S. Attorney's Office said.

The whistleblower who filed the lawsuit will receive $30 million as part of the settlement, and the remainder will be given to the Medicaid and Medicare funds in Washington D.C., the prosecutor said. The state of Vermont will not get any money from the settlement. read more »