April 19, 2019
After pleading guilty to conspiracy to commit wire fraud and aggravated identity theft in the United States District Court for the Middle District of Florida, Hemalkumar Shah was sentenced to eight years and six months in federal prison and ordered to pay $80,000. As set forth in part in the DOJ Release:
[F]rom at least 2014 through at least 2016, Shah conspired with U.S.-based co-conspirators and India-based call centers to extort money from U.S. residents by impersonating IRS officers and misleading victims to believe that they owed money to the IRS and would be arrested and fined if they did not pay their alleged back taxes immediately. The conspirators collected the fraud proceeds by (1) withdrawing cash from prepaid cards purchased and funded by victims; (2) hiring other conspirators (runners) to retrieve money wired by the victims to those runners; and/or (3) hiring runners to open bank accounts into which victims deposited fraud proceeds. The defendants collected the proceeds by providing the runners with the victims' names, locations, and amounts paid. The runners were directed to retrieve the fraud proceeds in cash and turn the funds over to the defendants, often less a payment to the runner for opening the account or conducting the transaction.
In a Complaint filed in the United States District Court for the Central District of California, https://www.sec.gov/litigation/complaints/2019/comp24435.pdf,
the SEC alleged that Motty Mizrahi and MBIG Company defrauded at least 15 advisory clients out of more than $3 million by falsely claiming that MBIG used sophisticated trading strategies to generate "guaranteed" returns of between 2-3% per month, the investments were risk-free, and clients would not lose their money and could withdraw their funds at any time. The Complaint alleges that Mizrahi used client money to fund his personal brokerage account, in which he engaged in high-risk options trading, producing losses of more than $2.2 million, and to pay personal expenses. Allegedly, Mizrahi covered up his fraud by issuing MBIG's clients false account statements that showed positive account balances and profits from trading and, when clients demanded proof of MBIG's securities holdings, he showed them brokerage statements reflecting a phony multi-million dollar balance for a fictitious MBIG brokerage account. The Court issued a preliminary injunction that enjoins Mizrahi and MBIG from violating the antifraud provisions of Section 10(b) of the Securities and Exchange Act and Rule 10b-5 thereunder and Sections 206(1) and (2) of the Investment Advisors Act of 1940.
In a Complaint filed in the United States District Court for the Central District of California https://www.sec.gov/litigation/complaints/2019/comp24454.pdf, the SEC charged former Skyworks Solutions, Inc. engineer Yuh-Yue Chen with having traded multiple times in advance of the company's earnings announcements after he improperly accessed the company's accounting and finance area, reviewed non-public financial reports, and used that information to purchase Skyworks securities in advance of the company's announcements of financial results for the second and third quarters in 2014. The Complaint alleges that after Skyworks announced positive quarterly financial results on April 22, 2014 and again on July 17, 2014, Chen sold Skyworks securities for a total profit of at least $739,959. In September 2014, Chen allegedly fled the country after Skyworks' security found him loitering in the office restricted area designated for the accounting and finance staff. Upon returnibg to the United States at the end of March, Chen was interviewed and subsequently served with the SEC's Complaint, which charges him with violations of the antifraud provisions of Section 10(b) of the Securities Exchange Act and Rule 10b-5 thereunder and seeks a permanent injunction, disgorgement plus interest and penalties.
Donald Trump has been nothing but persistent in his refrain that he didn't do anything wrong. Robert Mueller's sotto voce report concluded that Trump didn't do anything wrong, but, well, you know, he probably should have done something better. As with all bonfires, this one dies out amid thinning wisps of smoke. All of which reminds me of that wonderful song by Lake Street Dive with its fabulous lead singer Rachael Price: You said I, I didn't do anythin' wrong; But there must have been somethin' I could've done better