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Friday, December 12, 2008

Top broker and Wall Street adviser Bernard L. Madoff, aged 70, was arrested and charged by the FBI on Thursday with a single count of securities fraud, also known as stock fraud and investment fraud. He allegedly told senior employees of his firm on Wednesday that his $50 billion business “is all just one big lie” and that it was “basically, a giant Ponzi scheme (since at least 2005).” Mr. Madoff faces up to 20 years imprisonment and a fine of up to $5 million. FBI agent Theodore Cacioppi said Mr. Madoff’s investment advisory business had “deceived investors by operating a securities business in which he traded and lost investor money, and then paid certain investors purported returns on investment with the principal received from other, different investors, which resulted in investors’ losses of approximately $50 billion dollars.”

The former chairman of the Nasdaq Stock Market is also the founder and primary owner of Bernard L. Madoff Investment Securities LLC, the closely-held market-making firm he launched in 1960. The firm is one of the top market maker firms on Wall Street. He founded his family firm with an initial investment of $5,000, after attending Hofstra University Law School. He saved the money earned from a job lifeguarding at Rockaway Beach in Queens and a part time job installing underground sprinkler systems.

A force in Wall Street trading for nearly 50 years, he has been active in the National Association of Securities Dealers (NASD), a self-regulatory organization for the U.S. securities industry. His firm was one of the five most active firms in the development of the NASDAQ, having been known for “paying for order flow,” in other word paying a broker to execute a customer’s order through Madoff. He argued that the payment to the broker did not alter the price that the customer received. He ran the investment advisory as a secretive business, however.

Dan Horwitz, counsel of Mr. Madoff, in an interview, said that “he is a longstanding leader in the financial-services industry with an unblemished record; he is a person of integrity; he intends to fight to get through this unfortunate event.” Mr. Madoff was released on his own recognizance on the same day of his arrest, after his 2 sons turned him in, and posting $10 million bail secured by his Manhattan apartment. Without entering any plea, the Court set the preliminary hearing for January 12.

Madoff’s hedge fund scheme may rank among the biggest fraud in history. When former energy trading giant Enron filed for bankruptcy in 2001, one of the largest at the time, it had $63.4 billion in assets. The scheme would dwarf past Ponzis, and it would further be nearly five times the telecommunication company WorldCom fraud and bankruptcy proceedings in 2002.

The Securities and Exchange Commission filed a separate civil suit on Thursday against Bernard L. Madoff Investment Securities and its eponymous founder Mr. Madoff. It was docketed as “U.S. v. Madoff,” 08-MAG-02735, by the U.S. District Court for the Southern District of New York (Manhattan). SEC, New York associate director of enforcement, Andrew M. Calamari, asked the judge to issue seizure orders on the firm and its assets, and appoint a receiver. The SEC pleads, among others, that “it was an ongoing $50 billion swindle; our complaint alleges a stunning fraud that appears to be of epic proportions.” It further accused the defendant of “paying returns to certain investors out of the principal received from other, different investors” for years. Madoff’s hedge fund business had previously claimed to have served between 11 and 25 clients and had $17.1 billion in assets under management. But virtually all of the assets were missing.

United States District Court for the Southern District of New York Louis L. Stanton on Thursday appointed Lee Richards, a Manhattan lawyer, as the firm’s receiver. A hearing is set for Friday, for a ruling on the SEC’s petition to grant plenary powers to the receiver over the entire firm, and an absolute asset sequestration.

Doug Kass, president of hedge fund Seabreeze Partners Management said that “this is a major blow to confidence that is already shattered — anyone on the fence will probably try to take their money out.”

Monday, March 15, 2010

An undercover investigation by Naperville, Illinois law enforcement has led to the arrest last Thursday of four people allegedly involved in prostitution. The stings came after police received tips that people were using websites like Craigslist and Backpage.com to sell sexual performances in Naperville hotels. 

Patricia H. Scoleri of Naperville was arrested after an unidentified neighbor observed consistently suspicious activity at Scoleri’s home. Traffic was unusually heavy and consisted mostly of luxury cars in an otherwise quiet, middle-class neighborhood. Also, the visitors were mainly middle-aged men, and an odd string of lavender-colored lights were hung on the front window.

Police say Scoleri worked alone. She was arrested at 2 p.m. local time (2000 UTC) and is charged with violation of anti-prostitution laws, anti-cannabis laws, and the Massage Licensing Act. She apparently has four children, but the Illinois Department of Children and Family Services has neither contacted her nor received a police report on her.

The second sting occurred at 5:30 p.m the same day (2330 UTC) and resulted in the arrest of Chicago resident Tonya M. Adams. She is charged with prostitution and driving without a license. Another sting about an hour later resulted in the arrests of Jessica M. Walley, a Skokie resident, and Mark A. Williams, a self-admitted Schaumburg gang member. “Walley was charged with prostitution and unlawful possession of cannabis. Williams was charged with pimping, obstructing a peace officer, driving with a suspended license and driving without insurance,” reports WBBM News Radio 780.

All four suspects are free, having paid the required ten percent of their $1,000 bail. They may face additional charges related to crack cocaine discovered during the police investigation. Arraignment is scheduled for next month at the DuPage County Circuit Courthouse in Wheaton.

Wednesday, August 23, 2006

John Mark Karr, the man who last week admitted to killing six year-old JonBenét Ramsey on Boxing Day 1996, has been told by a judge that he will be sent to Colorado to face charges.

On Monday, the forty-one year-old American teacher was extradited from Bangkok in Thailand to California. From there he will fly to Colorado within the next few days, and it is expected that he will be formally charged with murder, sexual assault and kidnapping.

JonBenét, a beauty queen, was found beaten and strangled to death in her Colorado home on the day after Christmas in 1996.

In a press conference last Wednesday, Karr confessed to being with JonBenét when she died, adding that her death was an accident. “I was with JonBenét when she died. I loved JonBenét. She died accidentally. I am so very sorry for what happened to JonBenét. It’s very important for me that everyone knows that I love her very much, that her death was unintentional, that it was an accident.”

Despite his confession, Karr’s then ex-wife said that he was in Alabama with her when the murder occurred.

Friday, June 16, 2006

Former American Idol winner Ruben Studdard has won a lawsuit and $2 million against his ex-manager Ronald W. Edwards and Edwards’ promotions company, Sez Inc. The lawsuit was for misappropriating the singer’s money and credit cards. The suit claimed Edwards misused more than $246,000 of the singer’s money. According to the judge’s ruling, Edwards stole money from Studdard’s checking and other bank accounts, improperly used his credit cards and even used Studdard’s money to repay a $10,000 bank loan.

Jefferson County Circuit Judge Scott Vowell awarded Studdard $500,000 for actual losses and another $1.5 million in punitive damages. Vowell dismissed Edwards’ promotions company from the suit because it was bankrupt and had no money or assets. Edwards filed a petition for Chapter 7 bankruptcy on June 17, 2005. Studdard has sold 2.2 million records, but because of the damage done to his credit by Edwards, it is now even hard for Ruben to buy a home, said Vowell.

Friday, November 3, 2006

A Richmond Hill, Ontario man is currently released after he was abducted and escaped last night.

Chee Kian Jeff Chan, 28, was forced by three people into a black Mercedes SUV (which was caught on security camera) in the parking garage of his condominium at 23 Oneida Cresant in the Yonge Street and High Tech Road area. A small amount of blood was found at the scene. He was dropped off at an unnamed location in Toronto Wednesday night.

The suspects were wearing black clothes and balaclavas covering their faces at the time of the incident. The licence plate number of the Mercedes SUV is not known because there was no plate on the front of the vehicle.

Chan walked into the Major Mackenzie Dr. W. police station, at about 6:45 p.m. last night, suffering from injuries and went to a hospital for examination.

York Regional Police say that he is a poker player, after hearing about a man with the same name that took seventh place at the River Rock Casino Resort near Vancouver, British Columbia on November 19, 2005, earning him $44,753.

No ransom note was received and police believe that it was an extortion attempt.

“He was unaware of a lot of things during his ordeal,” Constable Laurie Perks said. “He didn’t know what they looked like. His vision was concealed and so he therefore didn’t know where he was through most of his ordeal.”

It is believed that Chan’s three captors released him after 28 hours because of the media coverage surrounding his disappearance.

The investigation is still ongoing.

Monday, December 31, 2007

What would you tell your grandchildren about 2007 if they asked you about it in, let’s say, 20 year’s time? If the answer to a quiz question was 2007, what would the question be? The year that you first signed on to Facebook? The year Britney Spears and Amy Winehouse fell apart? The year author Kurt Vonnegut or mime Marcel Marceau died, both at 84?

Let’s take a look at some of the international stories of 2007. Links to the original Wikinews articles are in bold.

Thursday, August 3, 2006

The United States Food and Drug Administration has announced that it is moving forward in approving over-the-counter (OTC) sale of the emergency contraceptive pill, “Plan B” to women above 18 years of age. The delayed approval of this drug has been raised in the Senate confirmation hearings for President Bush’s nominee for the head of the FDA, Dr. Andrew C. von Eschenbach.

Emergency contraceptives, also known as “morning-after pills” are used to prevent an unintended pregnancy, after unprotected intercourse has occurred. They usually contain high doses of the same drugs that are used in regular contraceptive pills.

While they are considered as contraceptives by the medical establishment and by law, and classified as such by the FDA, some abortion opponents object to ECs as they believe that they constitute abortion. Some groups object to emergency contraception believing that it encourages sexual exploitation of young girls and some religious conservatives object to it as they believe that it promotes promiscuous behavior. Proponents of its use contend that it is merely a form of contraception, and point out that other forms, such as condoms or birth-control pills are widely used and that its use serves an important purpose, in cases where other contraceptives have failed (eg. a condom is torn) or to prevent conception in a rape victim. Approval for OTC sale would make the drug more easily available, which is considered important as the drug must be taken within 72 hours of intercourse to be effective.

The FDA’s approval process for the Plan B pills, which contain the drug Levonorgestrel and are manufactured by Duramed, a subsidiary of Barr Laboratories has been mired in controversy since at least 2000, when the American Medical Association announced support for OTC availability. Last year, the FDA rejected the manufacturer’s request to approve the pill for OTC sale, citing concerns over “potential behavioral implications for younger adolescents”. The decision was criticised by advocates of EC as being based on political considerations rather than scientific reasons. The Government Accountability Office, a congressional watchdog also faulted the decision process. The FDA has also revised the minimum age of customers from 16 to 17 to now, 18.

Currently, the Senate Health, Education, Labor and Pensions Committee is holding hearings on the confirmation of the FDA Commissioner nominee, Dr. von Eschenbach. Senators Patty Murray(D) and Hillary Clinton(D) have held up the approval pending progress on the pill’s approval process. Plan B was endorsed by a F.D.A. committee three years ago but had been denied approval for OTC sale by higher officials in the FDA. During the nomination of the last FDA Commissioner, Dr. Lester M. Crawford, Senators raised the issue and went ahead with the nomination after getting assurances that the drug’s approval would be given in a timely manner. The deadlines set then were not met.

Senator Clinton was reported as saying: “Like so much of this government in the past five and a half years, it has been turned into a political football, and you’re on the field. This is not just about Plan B. Once we start politicizing the F.D.A. there is no stopping. It is essential that we draw a line, and we are drawing a line right here.”

In the confirmation hearings, Dr. Von Eschenbach said he would not take political orders on scientific matters. “No one told me what I could or should do,” he said.

The FDA statement said that its latest decision was to approve OTC sale was “the result of a thoughtful and comprehensive scientific and public policy process undertaken by the Agency to resolve the novel and significant issues presented by the Sponsor’s amended application.”

Sale of oral contraceptives otherwise continues to require prescription by a state-licensed doctor, according to FDA regulation.