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Jay Clayton sworn in as chairman of the US SEC
Wall Street attorney Jay Clayton was officially sworn in as chairman of the U.S. Securities and Exchange Commission by U.S. Supreme Court Justice Anthony Kennedy on Thursday, the agency announced. read more »
UC Regents Say Doctors & Pharmacists Ran $12 Million Fraud
The University of California claims in court that a group of physicians defrauded students’ self-funded health care benefit plan of $12 million by prescribing thousands of drugs to students who did not know they had been dispensed under their names.
The Regents of the University of California sued Studios Pharmacy, Excel Care Pharmacy, Pharma Pro Solutions and California Clinical Trials, and 17 people in Superior Court, claiming they “drained” the University of California Student Health Insurance Plan of millions of dollars through bogus claims. read more »
Credit Suisse pays $400 million over toxic mortgages, failed U.S. credit unions
Credit Suisse Group AG paid $400 million to settle claims that the Swiss bank sold toxic mortgage securities that contributed to the demise of three federal credit unions, a U.S. regulator said on Wednesday.
The National Credit Union Administration said the settlement resolves the 19th of 20 lawsuits it filed in the last six years against banks over their underwriting or sale of securities to five credit unions that failed in 2009 and 2010.
Including a $445 million accord with UBS Group AG announced on Monday, the NCUA said it has recovered roughly $5.1 billion from the banks from these lawsuits.
It said proceeds will be used to pay claims against the Constitution Corporate, Members United Corporate, Southwest Corporate, U.S. Central and Western Corporate credit unions.
Credit Suisse's payment resolves claims that the bank misled Southwest Corporate, U.S. Central and Western Corporate about the risks of $715 million of residential mortgage-backed securities bought from 2005 to 2007, court records show. read more »
HSBC spends more on fighting financial crime as profits fall by 19%
Britain’s biggest bank says it has hired more staff and spent extra on compliance as part of deferred prosecution agreement
HSBC has been hiring more staff to fight financial crime in an attempt to overcome a series of scandals which have plagued it in recent years.
Britain’s biggest bank said its spending on “regulatory programmes and compliance” rose 12% to $800m (£620m) in the first three months of 2017 as it announced a 19% fall in first-quarter profits to £3.8bn.
A deferred prosecution agreement - put in place alongside a £1.2bn fine imposed in 2012 by US authorities for poor controls that allowed Mexican drug traffickers to make deposits - has put a focus on HSBC’s attempts to improve its resilience to financial crime. read more »
Watchdog probes Rolls-Royce accountants KPMG for failing to spot bribes
An investigation has been launched into the auditing of Rolls-Royce after accountants failed to flag up the engineering giant paying huge bribes to win contracts.
Auditors KPMG’s work examining Rolls’s accounts for 2010, 2011 and 2013 is being probed by regulators at the Financial Reporting Council.
The watchdog said the probe related to Rolls’s agreement with the Serious Fraud Office to pay £671m in fines to settle long-running investigations into allegations it used middlemen to make payments to land work all over the world.
Announcing the fines - which meant that Rolls avoided a criminal prosecution that could have meant it losing tens of billions of pounds in Government contracts - judge Sir Brian Leveson said in January that “truly vast, endemic” bribery and corruption took place inside the world-famous company for decades. read more »
Former Military Sealift Command Contractor Charged with Bribery and Fraud
A former contractor at the Military Sealift Command (MSC) was indicted for his role in a bribery and fraud conspiracy from approximately 1999 to 2014, in which he allegedly received almost $3 million dollars in bribes. Acting Assistant Attorney General Kenneth A. Blanco of the Justice Department’s Criminal Division and U.S. Attorney Dana J. Boente of the Eastern District of Virginia made the announcement.
Scott B. Miserendino Sr., 58, formerly of Stafford, Virginia, was charged in a five-count indictment with one count of conspiracy to commit bribery and honest services mail fraud, one count of bribery and three counts of honest services mail fraud. Miserendino’s arraignment will be scheduled at a later date.
According to allegations in the indictment, Miserendino was a government contractor at MSC, an entity of the U.S. Department of the Navy that provided support and specialized services to the Navy and other U.S. military forces. The indictment alleges that Miserendino and Joseph P. Allen, the owner of a government contracting company, conspired to use Miserendino’s position at MSC to enrich themselves through bribery. read more »
Biofuels firm indicted in fraudulent fuel credit scheme: Justice Department
A Pennsylvania biofuels firm and its co-owners have been indicted on conspiracy charges in a scheme that generated $10 million in renewable fuel credits from the Environmental Protection Agency, the U.S. Justice Department said on Thursday.
Keystone Biofuels Inc and its owners, Ben Wootton, 52, and Race Miner, 48, are accused of conspiracy and making false statements to fraudulently claim the credits on fuel that did not qualify to receive them. read more »
Firm, CEO Settle Charges in Ponzi-Like Scheme Involving Life Settlements
The Securities and Exchange Commission today announced that a New Jersey-based firm and its CEO have agreed to pay more than $4 million to settle charges that they used new investor money to repay earlier investors in Ponzi-like fashion and tapped investor funds for the CEO’s personal use.
According to the SEC’s complaint, Verto Capital Management and William Schantz III raised approximately $12.5 million selling promissory notes to purportedly fund Verto Capital’s purchase and sale of life settlements, which are life insurance policies sold in the secondary market. The SEC alleges that they misrepresented to investors that Verto Capital was a profitable company and investor funds would be used for general working capital purposes. Verto Capital and other Schantz businesses had been unprofitable for several years, according to the SEC’s complaint, and Schantz resorted to taking disproportionately large distributions of investor funds for himself and using new investor money to repay earlier investors. read more »