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Tag: U.S. Attorney Loretta E. Lynch

  • President Obama To Nominate Loretta Lynch To Replace Eric Holder As Attorney General

    Loretta Lynch. Source: U.S. Attorney's website.
    Loretta Lynch. Source: U.S. Attorney’s website.

    UPDATED 8:42 A.M. ET NOV. 9 U.S.A. Many Americans will have only a vague recollection of her name. Others will not be able to place her at all. But they’ll remember cases with which she has been involved.

    One of those involved the prosecution of New York City police officers, including Justin Volpe, implicated in the brutal and unthinkable attack against Haitian immigrant Abner Louima in 1997. Americans of all races and creeds were infuriated at the news cops had assaulted Louima  — and then hatched a coverup. The assault and the efforts to hide it embarrassed police agencies and prosecutors in New York and across the land because law enforcement is supposed to safeguard and champion civil rights, not violate and dispose of them.

    The White House announced yesterday that President Obama today will nominate Loretta Lynch, a member of the team that brought justice to one of America’s most famous crime victims, to replace Eric Holder as Attorney General of the United States. Holder, in September, announced that he is stepping down. Lynch currently is the U.S. Attorney for the Eastern District of New York. Local residents think of her as the U.S. Attorney for Brooklyn, Queens, Staten Island and Nassau and Suffolk Counties on Long Island.

    If confirmed by the Senate, Lynch will become the first African American female Attorney General in U.S. history. She was born in North Carolina 55 years ago.

    Here are two statements from Lynch that have appeared on the PP Blog:

    “As alleged in the complaint, the defendant came to this country intent on conducting a terrorist attack on U.S. soil and worked with single-minded determination to carry out his plan. The defendant thought he was striking a blow to the American economy. He thought he was directing confederates and fellow believers.” — U.S. Attorney Loretta E. Lynch, Eastern District of New York, Oct. 17, 2012

    Read the PP Blog story here.

    In 2011, Lynch’s office became involved in the prosecution of Vincent P. McCrudden. He was accused of threatening to to kill 47 current or former market regulators from the SEC, FINRA and others, and of publishing an “Execution List” on his website. McCrudden, later convicted, allegedly also encouraged others to kill regulators.

    Here is what Lynch said when the charges were brought:

    “In this day and age, there is no such thing as an idle threat. Those who threaten injury or worse to the lives of others will be promptly investigated and vigorously prosecuted.” — U.S. Attorney Loretta E. Lynch, Eastern District of New York, Jan. 14, 2011

    McCrudden’s arrest occurred just five days after a gunman in an unrelated incident had opened fire at an Arizona constituent event hosted by U.S. Rep. Gabrielle Giffords. Giffords was critically wounded in the attack. U.S. District Judge John Roll and five others were shot and killed.

    The PP Blog stories below also reference Lynch:

    BULLETIN: FBI Issues Wanted Posters, INTERPOL Issues Red Notices For Alleged International Cybercriminals Who Targeted Americans In Scam That Duped Big-Ticket Shoppers

    BULLETIN: Songkram Roy Shachaisere, Figure In AdSurfDaily Ponzi Story, Indicted With 8 Others In ‘One Of The Largest International Penny Stock Frauds In History’

    BULLETIN: Missing Investment Adviser Named In SEC Civil Complaint Yesterday In Atlanta Has Been Charged Criminally In New York

    BULLETIN: Vincent McCrudden Pleads Guilty To Threatening Regulators, Government Officials

    Accused Scammer And Convicted Felon Eric Aronson, 2 Others Indicted In Alleged Permapave Ponzi Scheme; ‘House Of Cards,’ Top Federal Prosecutor Says

    BULLETIN(S): (1) Missouri Con Man, 72, Charged In Alleged $3.18 Million Ponzi Caper While Jailed In Previous Fraud Scheme; (2) New York Woman Was Running Multiple Ponzi And Fraud Schemes That Gathered More Than $9 Million, Feds Say

    BULLETIN: Feds Say New York Man Was Running $50 Million Real-Estate Ponzi Swindle; Gershon Barkany Arrested By FBI

     

  • BULLETIN: Songkram Roy Shachaisere, Figure In AdSurfDaily Ponzi Story, Indicted With 8 Others In ‘One Of The Largest International Penny Stock Frauds In History’

    breakingnews72BULLETIN: Songkram Roy Shachaisere, a sidebar figure in the AdSurfDaily Ponzi scheme story, has been indicted with several others in what federal prosecutors in the Eastern District of New York are calling “one of the largest international penny stock frauds in history.”

    The probe “used wiretaps in the United States and undercover agents in foreign countries,” prosecutors said.

    Chillingly, prosecutors said some of the scammers impersonated IRS employees. Others joined forces to scam victims a second time by creating a “fake law firm.” Some of the money allegedly ended up in “an account maintained in Beirut, Lebanon.”

    Indeed, prosecutors said, some of the scammers branched off from the penny-story scheme to orchestrate a scheme “in which they fraudulently induced penny stock victims to pay advance fees, on the promise that the victims would then either be able to sell their securities to other waiting investors or join lawsuits to reclaim their losses,” the office of U.S. Attorney Loretta E. Lynch said.  “In reality, the advance fees were nothing more than a con, as neither the investors nor the lawsuits existed.  To hoodwink the penny stock owners, the advance fee defendants invented fake trading companies and a fake law firm and then posed as employees of those entities while soliciting advance fees from the penny stock victims.”

    “The criminals behind this scheme were shameless in heartlessly defrauding hundreds of victims out of their savings and retirement accounts for their own enrichment,” said James C. Spero, special agent in charge of Immigration and Customs Enforcement Homeland Security Investigations (HSI) in Buffalo.

    All in all, the scams netted at least $140 million and defrauded victims in 35 countries, prosecutors said.

    Fake news releases, bogus announcements about nonexistent ventures, bribes and fake posts on social-media sites were used to dupe the masses, prosecutors said.

    Shachaisere allegedly was involved in a massive pump-and-dump scheme. In 2010, according to the SEC, Sahachaisere fraudulently touted the stock of Praebius Communications. That’s the company ASD once conveniently announced was providing it a $200 million revenue infusion. ASD made the claim while awaiting a key ruling by the federal judge presiding over the ASD Ponzi case brought by the U.S. Secret Service in 2008.

    Even as critics were voicing concerns that ASD was advancing yet-another story that was too good to be true, members of the now-defunct Pro-ASD Surf’s Up forum were cheerleading ASD’s purported revenue infusion from Praebius.

    Some ASD members sprinted to forums to announce the news, but the information could not be verified. ASD later removed the announcement from its website.

    ASD’s name was not referenced in the SEC’s 2010 complaint against Shachaisere, and Praebius was not listed as a defendant in the case. Praebius was referenced in the case as a client that paid Sahachaisere and his company in stock “to provide investor relations services.”

    All in all, seven defendants were arrested today, with nine indicted. Before the bust, one of the defendants bragged, “We know enough to be subtle,” prosecutors said.

    Here is a list of the defendants:

    • Sandy Winick
      Citizenship: Canada
      Age: 55
      Bangkok, Thailand
    • Gregory Curry
      Citizenship: Canada
      Age: 63
      Bangkok, Thailand
    • Kolt Curry
      Citizenship: Canada
      Age: 38
      Ontario, Canada
    • Gregory Ellis
      Citizenship: Canada
      Age: 46
      Ontario, Canada
    • Gary Kershner
      Citizenship: United States
      Age: 72
      Tucson, Arizona
    • Joseph Manfredonia
      Citizenship: United States
      Age: 45
      Tom’s River, New Jersey
    • Cort Poyner
      Citizenship: United States
      Age: 44
      Boca Raton, Florida
    • Songkram Roy Shachaiser
      Citizenship: United States
      Age: 43
      Huntington Beach, California
    • William Seals
      Citizenship: United States
      Age: 51
      Fallbrook, California

    Here’s how prosecutors described the pump-and-dump scheme (italics added):

    As alleged in the indictment, defendants Sandy Winick, Gary Kershner, Joseph Manfredonia, Cort Poyner, Songkram Roy Shachaisere and William Seals orchestrated one of the largest international penny stock frauds in history. First, the defendants gained controlling interests of huge quantities of worthless stock in 11 public companies known in the industry as ‘file cabinet businesses’ – thinly traded companies with minimal assets and non-existent business operations, which in many cases were mere shell companies. They then ‘pumped up’ the share prices of the companies’ stock by engaging in fraudulent and illegal sales campaigns, which included distributing false press releases, announcing non-existent business ventures and fake mergers, posting false information on social media sites and bribing stock promoters and brokers.

    And here’s how prosecutors described the advance-fee component of the scam (italics/bolding added):

    As the indictment alleges, defendants Winick, Gregory Curry, Kolt Curry and Gregory Ellis perpetrated a second scheme in which they fraudulently induced penny stock victims to pay advance fees, on the promise that the victims would then either be able to sell their securities to other waiting investors or join lawsuits to reclaim their losses. In reality, the advance fees were nothing more than a con, as neither the investors nor the lawsuits existed. To hoodwink the penny stock owners, the advance fee defendants invented fake trading companies and a fake law firm and then posed as employees of those entities while soliciting advance fees from the penny stock victims.

    To facilitate the scheme, the defendants established boiler rooms or call centers from which members of the conspiracy would solicit advance fees from the unsuspecting penny stock victims. The call centers were located in various locales around the world, including Canada, Thailand and the United Kingdom. Recently, the defendants began planning to open a new call center in Brooklyn, New York. Some of the victims were told that they either needed to pay the advance fee to remove restrictions that were placed upon their penny stock, which prevented the victims from selling their stock in the market, or to join investors in a pending or anticipated lawsuit to recover losses that they incurred while owning the penny stock. Victims were then told that the advance fees were needed to convert the warrants of their stocks to a saleable security. In several instances, the advance fee defendants even pretended to be IRS employees collecting a bogus advance tax from victim investors before they could unload their penny stocks. The victims were directed to send payment of the advance fees to banks around the world, including bank accounts in New York City. The fraud proceeds were then transferred through a funds transfer network, located in Getzville, New York, to an account maintained in Beirut, Lebanon. Ultimately, these defendants generated more than $20 million in fraudulently obtained advance fees.

    Defendant Kolt Curry described the Advance Fee Scheme in the following way over an intercepted wire communication: “I would say that 100 percent of these stocks are like uh pink uh… just dumps . . . . so … ya know they’re totally, they’re like, so a lot of these guys are dying . . . . to get rid of this crap. . . . The money is good, it’s easy. It’s easy money. Definitely easy money, and it’s good money.” In fact, while bragging about his prowess as a fraudster, defendant Kolt Curry further stated, “I had a guy send me a million dollars over one phone call . . . . He actually sent me almost two million dollars over the period of the hit . . . . I guess in the industry they coin it as a smash and grab.” As for the group’s recent plans to open a call center in Brooklyn, New York, defendant Kolt Curry said, “I tell you what man . . . hitting the Americans would be like taking money from a baby.”

    Lynch’s office thanked various U.S. agencies for their worked on the probe. She also thanked the Royal Canadian Mounted Police, Financial Crime Intelligence Unit in Vancouver and the Integrated Market Enforcement Team in Toronto, and the Serious Organized Crime Agency in the United Kingdom. Meanwhile, prosecutors said that significant assistance was also provided by the United States Embassies in Ottawa, Toronto, London, Bangkok and Beijing.

  • URGENT >> BULLETIN >> MOVING: Would-Be Bomber With Claimed al Qaeda Ties Arrested In Plot To Blow Up New York Federal Reserve Bank, FBI Says

    “As alleged in the complaint, the defendant came to this country intent on conducting a terrorist attack on U.S. soil and worked with single-minded determination to carry out his plan. The defendant thought he was striking a blow to the American economy. He thought he was directing confederates and fellow believers.” — U.S. Attorney Loretta E. Lynch, Eastern District of New York, Oct. 17, 2012

    URGENT >> BULLETIN >> MOVING: A Bangladeshi national who claimed al Qaeda ties has been arrested on charges he intended to blow up the New York Federal Reserve Bank to “destroy America,” the FBI said.

    Quazi Mohammad Rezwanul Ahsan Nafis, 21, was arrested near the bank this morning after an FBI sting, the agency said.

    The public was not in danger because the “explosives that he allegedly sought and attempted to use had been rendered inoperable by law enforcement,” the FBI said.

    CBS News is reporting that Nafis was arrested “with his finger on the fake detonator.”

    “Attempting to destroy a landmark building and kill or maim untold numbers of innocent bystanders is about as serious as the imagination can conjure,” said Mary E. Galligan, acting assistant director in charge of the FBI’s New York Field Office.

    Before settling on the bank as a target, Nafis contemplated attacks on “a high-ranking U.S. official and the New York Stock Exchange,” the FBI said. The agency did not name the official.

    Nafis had been in the United States since January, the FBI said.

    While in the United States, Nafis “attempted to recruit individuals to form a terrorist cell,” the FBI said.

    And Nafis spoke about “our beloved Sheikh Osama bin Laden” to “justify the fact that Nafis expected that the [Federal Reserve Bank] attack would involve the killing of women and children,” the FBI said.

    New York was the site of one phase of the 9/11 terrorist attacks, which killed nearly 3,000 people.

    One of the people Nafis sought to recruit “was actually a source for the FBI,” the agency said. “Through the investigation, FBI agents and NYPD detectives working with the [New York Joint Terrorism Task Force] were able to closely monitor Nafis as he attempted to implement his plan.”

    From an FBI statement (italics added):

    During the investigation, Nafis came into contact with an FBI undercover agent who posed as an al Qaeda facilitator. At Nafis’ request, the undercover agent supplied Nafis with 20 50-pound bags of purported explosives. Nafis then allegedly worked to store the material and assemble the explosive device for his attack. Nafis purchased components for the bomb’s detonator and conducted surveillance for his attack on multiple occasions in New York City’s financial district in lower Manhattan. Throughout his interactions with the undercover agent, Nafis repeatedly asserted that the plan was his own and was the reason he had come to the United States.

    Earlier this morning, Nafis met the undercover agent and traveled in a van to a warehouse located in the Eastern District of New York. While en route, Nafis explained to the undercover agent that he had a “Plan B” that involved conducting a suicide bombing operation in the event that the attack was about to be thwarted by the police.

    Upon arriving at the warehouse, Nafis assembled what he believed to be a 1,000-pound bomb inside the van. Nafis and the undercover agent then drove to the New York Federal Reserve Bank. During this drive, Nafis armed the purported bomb by assembling the detonator and attaching it to the explosives.

    Nafis and the undercover agent parked the van next to the New York Federal Reserve Bank, exited the van, and walked to a nearby hotel. There, Nafis recorded a video statement to the American public that he intended to release in connection with the attack. During this video statement, Nafis stated, “We will not stop until we attain victory or martyrdom.” Nafis then repeatedly, but unsuccessfully, attempted to detonate the bomb . . .

  • BULLETIN: Missing Investment Adviser Named In SEC Civil Complaint Yesterday In Atlanta Has Been Charged Criminally In New York

    BULLETIN: Aubrey Lee Price, the missing Georgia man sued by the SEC in an alleged $40 million investment-fraud caper that depleted “substantially all” of the reserves of a bank in Southern Georgia, has been charged criminally in New York with embezzling $17 million from the bank.

    The office of U.S. Attorney Loretta E. Lynch of the Eastern District of New York said Price “disappeared after telling acquaintances that he had lost a large amount of money through trading activities and that he planned to kill himself.”

    He has been missing since at least June 16, prosecutors said.

    Price last was seen boarding a ferry boat in Key West, Fla. The ferry was bound for Fort Myers, prosecutors said.

    “Price has told acquaintances that he owns real estate in Venezuela and Guatemala,” prosecutors said. “Price recently traveled to Venezuela and returned to the United States from that trip on June 2, 2012.”

    After a Price company bought a controlling portion of the bank’s stock in December 2010, he “took on the responsibility of investing the bank’s capital” in early 2011, prosecutors said.

    Although the bank was told Price was investing the bank’s capital in U.S. Treasury securities, “Price fraudulently wired the bank’s funds to accounts that he personally controlled at other financial institutions and provided bank management with altered documents to make it appear as if he had invested the bank’s money in Treasury securities,” prosecutors said.

    The FBI is leading the criminal probe.

    Anyone with information regarding Price’s whereabouts or the alleged crime is urged to contact the FBI’s office in New York at 212-384-1000. Prosecutors said this email address also may be used: ny1@ic.fbi.gov.

    Persons with information on his whereabouts also may contact the Atlanta office of the FBI at 404-679-9000 or the Lowndes County Sheriff’s Office at 229-671-2985, the SEC said yesterday.

  • Accused Scammer And Convicted Felon Eric Aronson, 2 Others Indicted In Alleged Permapave Ponzi Scheme; ‘House Of Cards,’ Top Federal Prosecutor Says

    Eric Aronson, the accused New York scammer and convicted felon originally arrested in October 2011 in an alleged Ponzi scheme, now has been formally indicted, federal prosecutors in the Eastern District of New York said.

    Charged along with Aronson with conspiracy, securities fraud and money laundering were Vincent Buonauro and Fredric Aaron. Aaron is an attorney from Port Washington, N.Y. In a related civil action by the SEC in October 2011, his age was listed as 47.

    In the same civil complaint last year, the SEC listed Aronson’s age as 43. He is a resident of Syosset, N.Y., according to SEC filings. Buonauro was described in the same October 2011 SEC complaint as a 40-year-old  resident of West Islip, N.Y.

    The men allegedly were principals in Permapave Industries and Permapave USA, which the SEC described as a $26 million Ponzi scheme involving paving stones purportedly imported from Australia.

    “The defendants are alleged to have misled investors and, in paying some of them with proceeds from others, engaged in a Ponzi scheme to conceal how flimsy the investment was,” said Janice K. Fedarcyk, assistant director-in-charge of the FBI’s New York Field Office.

    ‘House Of Cards’

    “The defendants allegedly abused the trust placed in them by their investors by lying and stealing the investors’ money,” U.S. Attorney Loretta E. Lynch said.  “They promised a sound investment in a quality product, but instead shuttled the investors from one deceptive securities offering to another in an attempt to maintain their house of cards.”

    Aronson is a convicted felon who used proceeds from the Permapave scheme to pay restitution to victims of a scheme to which “he pleaded guilty to conducting in 2000? and was sentenced to 40 months in prison, the SEC said last year.

  • BULLETIN(S): (1) Missouri Con Man, 72, Charged In Alleged $3.18 Million Ponzi Caper While Jailed In Previous Fraud Scheme; (2) New York Woman Was Running Multiple Ponzi And Fraud Schemes That Gathered More Than $9 Million, Feds Say

    BULLETIN: A 72-year-old Missouri con man already jailed in a fraud case involving taxes and Pell Grants has been charged with orchestrating a Ponzi scheme that allegedly followed on the heels of his original scam.

    Ronald W. Shepard pulled off a Ponzi scheme involving more than $3 million, the office of U.S. Attorney Beth Phillips of the Western District of Missouri said.

    Separately, a woman has been charged with running multiple Ponzi and fraud schemes that sucked in $9 million, the office of U.S. Attorney Loretta E. Lynch of the Eastern District of New York said.

    Charged in the alleged New York capers was Laurie Schneider, 37, of Oceanside.

    One of Schneider’s schemes involved a “shell company” known as Janitorial Close-Out City Corp. In that scheme, Schneider duped 25 investors into believing she invested in industrial equipment and machinery manufactured by companies in China and sold products wholesale at a tremendous profit, federal prosecutors said.

    But it was a $4 million-plus Ponzi that promised enormous returns of up to 60 percent and paid investors with money from other investors. Another fraud scheme hatched by Schneider fetched $5 million, bringing the combined fraud intake to more than $9 million, prosecutors said.

    “As alleged, this defendant falsely represented herself as having international business connections that would benefit her investors, when in reality she was engaged in purely homegrown fraud and deception,” Lynch said.

    In the Shepard case, records show that the con man already is jailed in Arkansas for his original Missouri scam involving taxes and Pell Grants. In that 2007 scam, Shepard was accused of preparing and and submitting “false financial aid documents and tax returns to the Department of Education, as well as various colleges and universities, in order to obtain financial aid for his clients and their children. Shepard also allegedly prepared and submitted false federal income tax returns to the Internal Revenue Service in order to obtain inflated refunds for his clients.”

    Shepard initially was sentenced in 2009 to five years’ probation in the tax and Pell Grants scam. Pell Grants are named after the late Sen. Claiborne Pell, D.-Rhode Island. The grants provide financial aid to eligible college students.

    As part of his probation, Shepard was ordered not to be employed “in any capacity in which he would act in a fiduciary capacity,” not to commit any crimes and not to lie to his probation officer.

    After the government demonstrated that Shepard had a role in an ongoing scam involving other people’s money and had played word games with his probation officer, the judge revoked Shepard’s probation and ordered a five-year prison sentence. Although Shepard appealed, he lost.

    State and federal investigations continued while Shepard entered the prison system in the tax and Pell Grants case. The probe culminated in a Ponzi indictment charging Shepard with 13 counts of mail fraud and two counts of money laundering.

    Prosecutors said he raised more than $3 million in his Ponzi scheme, which involved a company known as Safety Solutions USA LLC that was developing a tow hitch and seeking a patent. The patent application was declined, but Shepard had promised investment returns of up to 100 percent, prosecutors said.

    Shepard, formerly of Lees Summit, Mo., also was involved with a real-estate firm known as “The Real Estate.”

    “Shepard allegedly told investors that their money was used to purchase property in Kansas City, the Lake of the Ozarks and Hawaii,” prosecutors said. “Except for purchasing his own personal residence at the Lake of the Ozarks, the indictment says, Shepard did not purchase any real estate. Instead, the indictment alleges that Shepard used investor funds for personal living expenses, to pay other investors, to pay relatives, in disbursements of cash to himself and in real estate ventures.”

    All in all, prosecutors said, Shepard took in more than $3.18 million though his Ponzi, paid bogus returns of more than $1.2 million — “and lost or spent the rest,” resulting in investors losses of at least $1.8 million.

  • URGENT >> BULLETIN >> MOVING: New York Man Arrested After Threatening To Kill CFTC, SEC, NFA And FINRA Regulators; Vincent McCrudden Used Emails, Website To Terrorize Officials, Prosecutors Charge

    A New York man sued by the CFTC last month for registration violations has been arrested on criminal charges of threatening to kill 47 current or former market regulators, federal prosecutors said.

    Vincent P. McCrudden, 49, who recently had been living in Singapore, was arrested yesterday by the FBI at Newark Liberty International Airport after returning to the United States.

    The arrest occurred just five days after a gunman opened fire at an Arizona constituent event hosted by U.S. Rep. Gabrielle Giffords. Giffords was critically wounded in the attack. U.S. District Judge John Roll and five others were shot and killed.

    McCrudden was denied bail this afternoon in the alleged threats against regulators, some details of which U.S. Attorney Loretta E. Lynch of the Eastern District of New York released today.

    “In this day and age, there is no such thing as an idle threat,” said Lynch. “Those who threaten injury or worse to the lives of others will be promptly investigated and vigorously prosecuted.”

    On Sept. 30, prosecutors said, McCrudden sent an email to an employee of the National Futures Association (NFA) that made a death threat.

    “[I]t wasn’t ever a question of ‘if’ I was going to kill you, it was just a question of when,” the email read, prosecutors said. “And now, that question has been answered. You are going to die a painful death.”

    McCrudden also published an “Execution List” on his website. The list included the names of 47 current and former officials of the SEC, FINRA, NFA, and CFTC.  Included on the list were the names of the “the Chairperson of the SEC, the Chairman of the CFTC, a former Acting Chairman and Commissioner of the CFTC, the Chairman and CEO of FINRA, the former chief of Enforcement at FINRA, and other employees of the NFA and CFTC,” prosecutors said.

    “[T]hese people have got to go,” McCrudden wrote, prosecutors said. “And I need your help, there are just too many for me alone.”

    And McCrudden “posted a $100,000 reward on his website for personal information of several government officials and proof that those officials were punished,” prosecutors charged.

    On Dec. 16, according to the complaint, McCrudden sent a CFTC official an email with a subject line of, “You corrupt mother[*!&$$%]!”

    The email went on to inform the official that he was “first on my list.”

    McCrudden used the website to encourage others to “[g]o buy a gun” and take back the country. On the website, McCrudden wrote that he would lead by example, prosecutors said.

    A top FBI official said the threats were “especially troubling.”

    “Overt threats of the sort made by this defendant must be dealt with to the fullest extent of the law,” said Janice K. Fedarcyk, assistant director-in-charge of the FBI’s New York field office.

    “The threats were direct, extreme, and specific, vowing to kill securities regulators and encouraging others to do the same,” Fedarcyk said.  “The allegations, coming as they do during a period of national mourning in the wake of horrific violence done to public officials and others, are especially troubling.”