Securities Law

Madoff Aides Talk to Feds, as Some Call for International Financial Court

As a plea deal in the federal criminal case against Bernard Madoff appears imminent, several people who worked for him reportedly are talking with prosecutors about how he allegedly operated a $50 billion Ponzi scheme. Under proffer agreements protecting them from prosecution if they tell the truth, two assistants told…

Mar 10, 2009 12:03 AM CDT

Madoff Guilty Plea in $50B Claimed Fraud Case is Expected Soon, N.Y. Times Says

Updated: The accused architect of an alleged record-breaking $50 billion Ponzi scheme operated under the guise of a hedge fund is reportedly close to settling the federal criminal case against him. Confirming earlier reports that a deal apparently is imminent, the New York Times reports, based on court filings tonight,…

Mar 6, 2009 6:48 PM CST

Madoff Losses Could Be Closer to $20 Billion

Investigators say Bernard Madoff has told them he has lost $50 billion in investors’ money, but the figure, like Madoff’s earlier reputation for financial prowess, may be larger than life. Some people involved in the case believe the real amount lost could be closer to $20 billion, the Associated Press…

Mar 6, 2009 12:05 PM CST

Stanford Official Charged With Lying to SEC Testified Without Her Own Lawyer

When the former chief investment officer for Stanford Financial Group testified before the Securities and Exchange Commission, the only defense lawyer who accompanied her represented the company. Today the official, Laura Pendergest-Holt, stands accused of lying during that testimony. During the hearing, the lawyer, Thomas Sjoblom of Proskauer Rose, emphasized—twice—that…

Mar 4, 2009 2:35 PM CST

Marc Dreier Led Sham Law Life for 4 Years, Magazine Says

It looked like Marc Dreier had a super-successful law practice. But for at least four years before he was accused late last year of defrauding sophisticated investors and clients of some $400 million, the New York lawyer’s seemingly opulent professional life was allegedly a sham. Dumped in 2006 by his…

Mar 4, 2009 12:54 AM CST

Ex-CEO Hank Greenberg Sues AIG, Says He Overpaid for Stock

Forced to resign in 2005 as chairman and chief executive of insurance giant American International Group Inc. after almost 40 years at the helm, Maurice “Hank” Greenberg is now suing AIG over an alleged securities fraud. Material misrepresentations and omissions by some former officers and four directors concerning AIG’s credit-default-swap…

Mar 3, 2009 8:50 PM CST

Bernanke: ‘Huge Gap’ Allowed AIG ‘Hedge Fund,’ Costing US Up to $200B

Testifying today at a Senate Budget Committee hearing in Washington, D.C., Federal Reserve Chairman Ben Bernanke said the financial products division of major insurance company had been operated like a hedge fund with virtually no government oversight. The fact that American International Group Inc. then had to be rescued with…

Mar 3, 2009 5:54 PM CST

Lawyers Say Madoff’s Wife Should Keep NY Penthouse, $62M

Lawyers for Bernard Madoff say the Manhattan penthouse where he lives as well as $62 million in assets should be exempt from seizure. The lawyers claim the assets and apartment are unrelated to fraud and they are owned by Madoff’s wife, according to the New York Times and the Associated…

Mar 3, 2009 12:05 PM CST

Amended SEC Complaint Accuses Stanford, CFO of Running Ponzi Scheme

The Securities and Exchange Commission has filed an amended complaint against R. Allen Stanford that alleges the Texas billionaire ran a huge Ponzi scheme and took at least $1.6 billion of investor money in personal loans. The amended complaint also accuses James Davis, the chief financial officer of Stanford’s company,…

Mar 2, 2009 12:11 PM CST

First Person Arrested in Stanford Probe; Affidavit Tells of Attorney Prayer

The FBI has made its first arrest in a probe of wrongdoing at Stanford Financial Group. Laura Pendergest-Holt, the company’s top investment officer, was charged with obstruction of justice, according to stories in the Wall Street Journal (sub. req.), the New York Times and Reuters. She is accused of misleading…

Feb 27, 2009 12:45 PM CST

Judge Criticizes Irell & Manella in ‘Iconic’ Client Conflicts Case

A federal judge in California has found “ethical failures” in Irell & Manella’s work in stock options cases involving Broadcom Corp. At the end of a three-day evidentiary hearing, U.S. District Judge Cormac Carney of Santa Ana said the ethics lapses involved failure to obtain written consent, the Daily Journal…

Feb 26, 2009 12:12 PM CST

Experts Say Madoff Must Have Had Help With Alleged $50B Ponzi Scheme

So far, no one but Bernard Madoff has been charged in the alleged $50 billion Ponzi scheme he is accused of operating under the guise of a hedge fund. But a recent claim by a trustee that the operation may have made no trades whatsoever for more than a decade,…

Feb 25, 2009 7:38 PM CST

En Banc Appeals Court Reinstates Conviction of Ex-Qwest CEO

An en banc federal appeals court has reinstated the insider-trading conviction of Joseph Nacchio, the former chief executive of Qwest Communications. In a 5-4 ruling, the full 10th U.S. Circuit Court of Appeals based in Denver said the trial judge did not err by excluding the testimony of a defense…

Feb 25, 2009 6:20 PM CST

Hedge Fund Run by Biden’s Son and Brother Had Links to Stanford

A hedge fund owned by Vice President Joe Biden’s son and brother had links to a Texas billionaire accused in an $8 billion fraud. The hedge fund, launched in June 2007, was owned through a holding company by Biden’s son, Hunter, and his brother, James, the Wall Street Journal reports…

Feb 24, 2009 1:40 PM CST

Why Didn’t SEC Move Faster in Stanford Case, Law Prof Wonders

What did the feds know about the operations of R. Allen Stanford, and when did the feds know it? That is essentially the question on the mind of law professor Peter Henning of Wayne State University. Writing in the DealBook blog of the New York Times today, he ponders parallels…

Feb 23, 2009 7:14 PM CST