AMLAC March LinkedIn Newsletter

Here's the March edition of the newsletter we regularly send out to our AMLAC LinkedIn group members. Remember to join our AMLAC LinkedIn Group if you haven't so already in order to receive these announcements on a monthly basis. Enjoy!

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Livent executives found guilty of fraud

Gareth Drabinsky and Myron Gottlieb were convicted of forgery and defrauding shareholders of over $400 million. They lead Broadway production firm Livent. They ran a fraudulent accounting system, which consisted of one set of books that showed a pretty picture of the success of the firm, and a second real book that showed that their losses were substantial. For the full story, read the article.

Obama Plans to Propose Stronger Financial-Fraud Rules

According to Bloomberg.com, the Obama administration plans to unveil new rules to protect consumers and investors against financial fraud, aiming to stamp out practices that helped spark the mortgage-market crisis. Of course this will require more money from the government, which Geithner and Obama believe exists at this time. What do you think? What measures will they put into place to combat fraud against consumers?

Ex-Enron Executive Goes Before the High Court

Chron.com reports that Scott Yeager, an ex-Enron executive of the broadband division, recently took his case to the Supreme Court to give reasons why he should not be retried after a jury acquitted him of conspiracy and fraud in 2005. His case is not the first Enron related case to go to the Supreme Court, but he is the first former executive whose case won a bid to be heard by the high court. It will be interesting to see if any other Enron executives will be going before the high court as well.

Money seized in Parrent Case

Last week, we reported that Rebecca Parrett had disappeared after being convicted of securities and wire fraud as well as money laundering. Now, according to Forbes, a federal judge has ordered the seizure of nearly $400,000. Thiso money was given to an attourney by Parrent after removing it from her Escrow account.

Top 3 Emerging Mortgage Scams To Watch Out For

The Consumerist reports on the top 3 mortgage scams that target individuals in the United States. With the home crisis still at its peak, its a great resource for those wanting to protect themselves from mortgage fraud. The post reports on these areas of mortgage fraud. Are there others that consumers should be aware of? We'd like to hear your thoughts.

• Elderly and Immigrant Identity Fraud
• Builder Bail-Out Fraud
• Foreclosure Prevention Schemes

Tax Fraud Scheme in Virginia

This article in MSNBC reports that lawyers for Edward Hugh Olkun have told the jury in Richmond that the Miami man did not try to defraud anyone and that he simply made mistakes. Edward is being charged in a $132 million fraud scheme accused of defrauding 577 people across the country. Is there a fine line between making mistakes and committing fraud? What do you think?

Mortgage fraud down in some areas of California

In a report from the LA Times, they state that more law enforcement and increased bank security has attributed to the falling numbers of mortgage fraud in the area. Nationally, mortgage fraud went up 26% from 2007 to 2008. For more on the story, read the article.

Sentence date set for former National Century Financial executive

Rebecca Parrett, the former CEO of National Century Financial, who disappeared after she was convicted of 13 counts of securities, wire fraud and money laundering, has been set for March 27 in Columbus, Ohio. She could face up to 20 years in prison.

Source: Forbes

Madoff Charged with 11 Criminal Counts

According to Reuters.com, Bernard Madoff was charged with 11 Criminal Counts during is infamous Ponzi scheme that left thousands of investors penniless and two individuals dead.

The counts that Mr. Madoff faces are as follows:

* Securities fraud, investment adviser fraud, mail fraud, wire fraud, three counts of money laundering, false statements, perjury, false filings with the U.S. Securities and Exchange Commission, and theft from an employee benefit plan.

* Madoff's lead attorney told a judge in Manhattan federal court on Tuesday that the money manager is expected to plead guilty on Thursday.

* U.S. prosecutors say there is no plea agreement between Madoff and the government, indicating he is unwilling to admit there was a conspiracy.

* The prosecutors say "the size and scope of Mr. Madoff's fraud are unprecedented" and their investigation is continuing.

* The government says Madoff faces up to 150 years in prison if convicted of all charges.

* The government says Madoff is also subject to mandatory restitution payments, fines and forfeiture of ill-gotten gains. The forfeiture sought by the government is more than $170 billion, a figure that has been challenged by Madoff's lawyers.

* The government says Madoff's investment business had about 4,800 client accounts as of November 30. 2008.

* The investment business issued statements for November 2008 reporting accounts held a total of $64.8 billion. In reality, the business "held only a small fraction" of that balance for clients, according to the government.

* Prosecutors contend the alleged scheme lasted from "at least" the 1980s, and Madoff hired numerous employees "with little or no prior pertinent training or experience in the securities industry" to communicate with his investment clients and "generate false and fraudulent documents."

Mr. Madoff faces live in prison.

Doc pleads guilty to $6 mil. fraud

According to the Chicago Sun-Times, Dr. Robert Weinstein of Chicago was accused of siphoning $6 million from a North Shore charity with his friend Stuart Levine and keeping $3 million for himself in a complicated series of financial transactions. Weinstein admitted he didn't report the income to the IRS.

He faces three years in prison when he is sentenced in July.

FBI investing Stanford case

At Forbes, they report that the FBI is asking anyone who invested in the Stanford Financial Group to contact the police. The FBI is asking for names addresses and phone numbers. For more, read this article at Forbes.

Madoff expected to plead guilty to fraud charges

According to Reuters.com, embattled hedge fund fraudster Bernie Madoff is expected to plead guilty on fraud charges when in court next week. A court document signed on Friday by prosecutors and Madoff's lead attorney indicated the once-respected Wall Street trader and investment manager would waive an indictment and plead guilty to criminal charges. Though its not set in stone, it looks like Mr. Madoff will soon be under more than just house arrest.

Call for Speakers: IIR's The Regulatory Risk and Compliance Forum

As economic uncertainty drives business into more complicated financial scenarios, compliance operations in the financial industry have received greater attention.

The 1st Annual Regulatory Risk and Compliance Forum in Washington, DC is the first event of its kind to offer a full-spectrum information and education platform that addresses this need.

The executive forum for Regulators, Chief Compliance Officers, Chief Risk Officers and General Counsel will be the place for professionals to address the most important issue in America since the Great Depression.

We invite you to name your choice for top Chief Compliance Officers and Chief Risk Officers from the following industries:

• Mutual Funds
• Commercial Banking
• Insurance
• Asset Management
• Money Services

The platform will engage directors and executive staff from SEC, FINRA, OCC, OFAC, FDIC, Federal Reserve Board, and SIFMA.

Confirmed:

Michael Carhill, Director – Risk Analysis, Office of the Comptroller of the Currency
Frank Knox, Chief Compliance Officer, John Hancock Mutual Funds
Ann Jaedicke, Deputy Comptroller of Compliance Policy, Office of the Comptroller of the Currency
Katie Kloster, Chief Compliance Officer of Mutual Funds, Thrivent Financial
Todd Kuehle, Chief Compliance Officer, Legg Mason
Arthur MacMahon, Director -- Economic Outlook / Bank Conditions, Office of the Comptroller of the Currency
Kate Murtagh, CCO, Harvard Management Company
Brett Rogers, Global Head of Risk Management and Governance, Deutsche Bank
Rob Shoemaker, Compliance Leader, GE Transportation
Akhtar Siddique, Risk Management Division, Office of the Comptroller of the Currency
Dennis Wood, Assistant Director – Office of Foreign Assets Control, Department of the Treasury
Daniel Wright, Chief Compliance Officer, Jackson National Life Distributors

Please send your submissions to dcrets@iirusa.com.
If you have questions, please do not hesitate to call Douglas on +1 646 616 7627

Fraudulent Use of Prepaid Debit Cards

This latest article on KOLOTV.com discusses how two H&R Block customers discovered that they were victims of fraud when they found out that their 2008 taxes had been filed and that the refund had been issued on a prepaid debit card without their knowledge.

Valerie Guerrero that worked as a tax preparer for H&R Block used the prepaid debit card to make several purchases in Sparks. Some of the charges she faces are burglary, fraudulent use of a credit card, possessing a credit card without the owners consent and receiving property as a result of unlawfully using a credit card.

What are some steps that prepaid industry is taking in order to stop fraudulent use of cards?

Cities on Fraud Watch List

The High Point Enterprise names Thomasville-Lexington Micropolitan, North Carolina area as one of the top places for fraud to take place in the United States. Other cities that made the list were Napa, California and Brownsville-Harlington, Texas. Read the full article here.

Broken Tooth Fraudster Pockets $36,000 in Insurance Claims

The Associated Press reports that Massachusetts fraudster, 44 year old Tod Schaffer has plead not guilty and released on his own recognizance after authorities charged him with insurance fraud. Schaffer made 21 false claims on he same broken tooth that he suffered from a visit at a restaurant. The tooth, which was injured with Schaffer bit into a piece of plastic in his salad at a restaurant in October 2002. The eatery paid the costs of his treatment. What's more interesting than Schaffer's claims is which insurance company doled out the $36 grand...

Ex-Congressman is Faced with several Money Laundering Charges

According to this article in CBS2.com Wes Cooley, an ex-congressman, has pleaded guilty to money laundering charges that are related to a $10 million investment scheme.

He is being charged with several counts of concealment money-laundering and filing a false tax return. He is also being charged with luring hundreds of people to buy unregistered stock in Bidbay.com using the internet. If convicted of all charges, Cooley faces up to 38 years in federal prison.