FILE – Interpreter Ippei Mizuhara, left, stands behind Japanese baseball star Shohei Ohtani, front right, and translates during an interview at Dodger Stadium, Feb. 3, 2024, in Los Angeles. Mizuhara is scheduled to plead guilty Tuesday, June 4, 2024, to bank and tax fraud in a sports betting case where he is expected to admit to stealing nearly $17 million from the Japanese baseball player. (AP Photo/Richard Vogel, File)
Tag: Corporate crime
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Former tech exec admits to fraud involving a scheme to boost Getty Images shares, authorities say
SAN FRANCISCO — A former technology executive has pleaded guilty to a single count of fraud involving a scheme to artificially inflate the share price of photo and video distributor Getty Images, federal officials said Friday.
Robert Scott Murray, who was chief executive of the networking-equipment maker 3Com for several months in 2006, was charged with securities fraud for an alleged attempt to manipulate Seattle-based Getty’s share price. Murray owned roughly 300,000 shares of Getty Images Holding Inc. in April 2023, according to a Department of Justice statement alleging that the investor sought to boost Getty’s stock in order to unload his position for a greater profit.
According to statement by the Securities and Exchange Commission, Murray first issued a series of news releases calling on the company to sell itself or to add Murray to its board. Murray issued those releases through Trillium Capital, a self-described venture investment business in Massachusetts whose sole owner and manager was Murray himself, federal authorities said.
Then, on April 24, 2023, Trillium announced a supposed bid to acquire Getty Images outright at a price of $10 a share — nearly twice the stock’s closing price a day earlier. While the company’s stock rose that day, its price remained well short of $10.
Getty issued its own news release the next day casting doubt on the offer, calling it an “unsolicited, non-binding and highly conditioned proposal” aimed at acquiring “an unstated volume of outstanding shares.” Trillium, it said, had not provided Getty’s board with any evidence that it was “sufficiently credible to warrant engagement.”
The SEC called the bid “false and misleading,” noting that Murray and Trillium made no effort to raise the funds necessary for the acquisition. What’s more, the SEC noted that “Murray started to liquidate his Getty Images stock within minutes after the market opened on April 24, without even waiting for Getty to respond to his announced offer.” The Justice Department statement asserted that Murray sold all of his Getty shares “within less than one hour for approximately $1,486,467.”
Murray could not be reached for comment. An email directed to an address on the Trillium website bounced back to The Associated Press, while multiple calls to Trillium’s published phone number yielded only busy signals.
Murray will appear in federal court in Boston at a later date, the Justice Department stated.
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Former tech exec admits to fraud involving a scheme to boost Getty Images shares, authorities say
SAN FRANCISCO — A former technology executive has pleaded guilty to a single count of fraud involving a scheme to artificially inflate the share price of photo and video distributor Getty Images, federal officials said Friday.
Robert Scott Murray, who was chief executive of the networking-equipment maker 3Com for several months in 2006, was charged with securities fraud for an alleged attempt to manipulate Seattle-based Getty’s share price. Murray owned roughly 300,000 shares of Getty Images Holding Inc. in April 2023, according to a Department of Justice statement alleging that the investor sought to boost Getty’s stock in order to unload his position for a greater profit.
According to statement by the Securities and Exchange Commission, Murray first issued a series of news releases calling on the company to sell itself or to add Murray to its board. Murray issued those releases through Trillium Capital, a self-described venture investment business in Massachusetts whose sole owner and manager was Murray himself, federal authorities said.
Then, on April 24, 2023, Trillium announced a supposed bid to acquire Getty Images outright at a price of $10 a share — nearly twice the stock’s closing price a day earlier. While the company’s stock rose that day, its price remained well short of $10.
Getty issued its own news release the next day casting doubt on the offer, calling it an “unsolicited, non-binding and highly conditioned proposal” aimed at acquiring “an unstated volume of outstanding shares.” Trillium, it said, had not provided Getty’s board with any evidence that it was “sufficiently credible to warrant engagement.”
The SEC called the bid “false and misleading,” noting that Murray and Trillium made no effort to raise the funds necessary for the acquisition. What’s more, the SEC noted that “Murray started to liquidate his Getty Images stock within minutes after the market opened on April 24, without even waiting for Getty to respond to his announced offer.” The Justice Department statement asserted that Murray sold all of his Getty shares “within less than one hour for approximately $1,486,467.”
Murray could not be reached for comment. An email directed to an address on the Trillium website bounced back to The Associated Press, while multiple calls to Trillium’s published phone number yielded only busy signals.
Murray will appear in federal court in Boston at a later date, the Justice Department stated.
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Ex-top prosecutor for Baltimore to be sentenced for mortgage fraud and perjury convictions
GREENBELT, Md. — A former top prosecutor for the city of Baltimore is to be sentenced this week for lying about her personal finances so she could improperly access retirement funds during the COVID-19 pandemic.
Sentencing for former Baltimore state’s attorney Marilyn Mosby is set to open Thursday at a federal courthouse in Greenbelt, a Maryland suburb of the nation’s capital. Two juries separately convicted Mosby of perjury and mortgage fraud charges after trials involving her personal finances.
Mosby, 44, gained a national profile for charging six Baltimore police officers in the 2015 death of Freddie Gray, a Black man fatally injured in police custody. Gray’s death led to riots and protests in the city. After three officers were acquitted, Mosby’s office dropped charges against the other three officers.
In 2020, at the height of the pandemic, Mosby withdrew $90,000 from Baltimore city’s deferred compensation plan. She used the money to make down payments on vacation homes in Kissimmee and Long Boat Key, Florida.
Prosecutors argued that Mosby improperly accessed the funds under provisions of the Coronavirus Aid, Relief and Economic Security Act by falsely claiming that the pandemic had harmed her travel-oriented side business.
Mosby’s lawyers argued that she was legally entitled to withdraw the money and spend it however she wanted.
Federal prosecutors have recommended a 20-month prison sentence for Mosby, who served two terms as state’s attorney for Baltimore. She lost a reelection bid after her 2022 indictment.
“Ms. Mosby was charged and convicted because she chose to repeatedly break the law, not because of her politics or policies,” prosecutors wrote.
Mosby’s attorneys urged the judge to spare her from prison. They said she is the only public official who has been prosecuted in Maryland for federal offenses “that entail no victim, no financial loss, and no use of public funds.”
“Jail is not justice for Marilyn Mosby,” her lawyers wrote.
Mosby applied for a presidential pardon earlier this month. In a letter to President Joe Biden, the Congressional Black Caucus expressed support for her cause, the Baltimore Sun reported.
U.S. District Judge Lydia Kay Griggsby agreed to move Mosby’s trials from Baltimore to Greenbelt, a suburb of Washington, D.C. Mosby’s attorneys argued that she couldn’t get a fair trial in Baltimore after years of negative media coverage there.
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Former Las Vegas casino executive to be sentenced in bookmaking money laundering case
LOS ANGELES — A former top executive for major Las Vegas casinos was set to appear before a federal judge on Wednesday after admitting he allowed an illegal bookmaker to gamble millions of dollars at the MGM Grand and pay off debts in cash.
Scott Sibella pleaded guilty in January to violating federal anti-money laundering rules that require casinos to file reports of suspicious transactions. He faces up to five years in prison and a $250,000 fine.
Following Sibella’s guilty plea, the MGM Grand and nearby Cosmopolitan of Las Vegas settled a related U.S. Justice Department money laundering probe. The resorts agreed to pay a combined $7.45 million, submit to an external review and step up their compliance programs.
Sibella’s attorneys, Jeffrey Rutherford in Los Angeles and John Spilotro in Las Vegas, were seeking leniency and a sentence of probation from U.S. District Judge Dolly Gee in Los Angeles. They submitted testimonial letters of support to the judge on Friday, including one from Clark County Sheriff Kevin McMahill, the elected head of the Las Vegas Metropolitan Police Department.
Rutherford and Spilotro did not respond Tuesday to email messages from The Associated Press.
The bookmaker central to Sibella’s case, Wayne Nix, is a former minor league baseball player who lives in Newport Coast, California. He’s awaiting sentencing after pleading guilty in April 2022 to operating an illegal gambling business and filing a false tax return.
According to his plea agreement with the government, Sibella allowed Nix to gamble at MGM Grand and affiliated properties with illicit proceeds generated from the illegal gambling business without notifying the casinos’ compliance department.
Sibella told federal investigators in January 2022 “that he had ‘heard that Nix was in the booking business’ and he ‘couldn’t figure out how he had all the money he gambled with.’”
“I didn’t want to know because of my position,” Sibella told investigators. “I stay out of it. If we know, we can’t allow them to gamble. I didn’t ask, I didn’t want to know I guess because he wasn’t doing anything to cheat the casino.”
Sibella was president and chief operating officer of the MGM Grand for eight years and then president of Resorts World Las Vegas until 2023. Federal prosecutors say Ippei Mizuhara, Los Angeles Dodgers star Shohei Ohtani’s former interpreter, transferred money he stole from the Japanese superstar to Resorts World in a scheme to pay off debts to illegal bookmakers. Sibella is not implicated in that case, which also is part of the broad federal investigation into sports gambling.
Separately, Nevada casino regulators are considering revoking or suspending Sibella’s state gambling license and fining him up to $750,000. A complaint filed April 30 by state Gaming Control Board investigators has not yet been considered by the Nevada Gaming Commission.
Sibella held top executive positions at The Mirage and Treasure Island casinos on the Las Vegas Strip before becoming president of the more than 6,800-room MGM Grand in 2011. He left the company in February 2019 and joined Resorts World Las Vegas before Malaysia-based Genting Group opened the $4.3 billion, 66-floor resort in June 2021.
He was dismissed by Resorts World in September 2023 after the company said he “violated company policies and the terms of his employment.”
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Ritter reported from Las Vegas.
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Trump Media’s newly hired auditing firm was just busted by the SEC for ‘massive fraud’
SAN FRANCISCO — The Securities and Exchange Commission on Friday charged an auditing firm hired by Trump Media and Technology Group just 37 days ago with “massive fraud” — though not for any work it performed for former President Donald Trump’s media company.
The SEC charged the accounting firm BF Borgers and its owner, Benjamin F. Borgers, with “deliberate and systematic failures” in more than 1,500 audits. The charges include failing to abide by accounting rules, fabricating documentation to cover up its shortcomings, and falsely stating in audit reports that its work met audit standards.
To settle the SEC charges, BF Borgers agreed to pay a $12 million fine while its owner agreed to pay a fine of $2 million, according to the SEC. Benjamin Borgers did not immediately return a call seeking comment.
BF Borgers and Benjamin Borgers also agreed to permanent suspensions, effective immediately, that will prevent them handling SEC-related matters as accountants.
Trump Media named BF Borgers as its auditor on March 28, according to the company’s most recent annual report filing. The company disclosed at the time that BF Borgers had also handled its audits before the company went public by merging with a cash-rich shell company called Digital World Acquisition Corp.
The company had previously cycled through at least two other auditors — one that resigned the account in July 2023 and another that was terminated by the board in March, just as it was re-hiring BF Borgers.
In a statement, Trump Media said it “looks forward to working with new auditing partners in accordance with today’s SEC order.”
The SEC found that BF Borgers’ shortcuts included copying audit documentation from a previous year, changing relevant dates and then passing it off as current documentation. In addition to falsely documenting work that was never actually done, that fake documentation detailed planning meetings with clients that never occurred and “falsely represented” that both Benjamin Borgers and another reviewer had approved the audit work.
“Ben Borgers and his audit firm, BF Borgers, were responsible for one of the largest wholesale failures by gatekeepers in our financial markets,” said Gurbir Grewal, director of the SEC’s enforcement division. “Thanks to the painstaking work of the SEC staff, Borgers and his sham audit mill have been permanently shut down.”
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Binance founder Changpeng Zhao faces sentencing; US seeks 3-year term for allowing money laundering
SEATTLE — Changpeng Zhao, the founder of Binance, the world’s largest cryptocurrency exchange, faces sentencing Tuesday in a Seattle courtroom, where U.S. prosecutors are asking a judge to give him a three-year prison term for allowing rampant money laundering on the platform.
Zhao pleaded guilty and stepped down as Binance CEO in November as the company agreed to pay $4.3 billion to settle related allegations. U.S. officials said Zhao deliberately looked the other way as illicit actors conducted transactions that supported child sex abuse, the illegal drug trade and terrorism.
“He made a business decision that violating U.S. law was the best way to attract users, build his company, and line his pockets,” the Justice Department wrote in a sentencing memorandum filed last week.
Zhao’s attorneys, insist he should receive no prison term at all, citing his willingness to come from the United Arab Emirates, where he and his family live, to the U.S. to plead guilty, despite the UAE’s lack of an extradition treaty with the U.S. No one has ever been sentenced to prison time for similar violations of the Bank Secrecy Act, they said.
“I want to take responsibility and close this chapter in my life,” Zhao said when he entered his guilty plea to one count of failing to prevent money laundering. “I want to come back. Otherwise I wouldn’t be here today.”
But prosecutors say no one has ever violated the Bank Secrecy Act to the extent Zhao did. The three-year prison term they’re seeking is twice the guideline range for the crime. Binance allowed more than 1.5 million virtual currency trades — totaling nearly $900 million — that violated U.S. sanctions, including ones involving Hamas’ al-Qassam Brigades, al-Qaeda and Iran.
Zhao knew that Binance was required to institute anti-money-laundering protocols, but instead directed the company to disguise customers’ locations in the U.S. in an effort to avoid complying with U.S. law, prosecutors said.
The cryptocurrency industry has been marred by scandals and market meltdowns. Most recently Nigeria has sought to try Binance and two of its executives on money laundering and tax evasion charges.
Zhao was perhaps best known as the chief rival to Sam Bankman-Fried, the founder of the FTX, which was the second-largest crypto exchange before it collapsed in 2022. Bankman-Fried was convicted last November of fraud for stealing at least $10 billion from customers and investors and sentenced to 25 years in prison.
Zhao and Bankman-Fried were originally friendly competitors in the industry, with Binance investing in FTX when Bankman-Fried launched the exchange in 2019. However, the relationship between the two deteriorated, culminating in Zhao announcing he was selling all of his cryptocurrency investments in FTX in early November 2022. FTX filed for bankruptcy a week later.
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US and China plan talks on economics, including manufacturing issue, Yellen says
GUANGZHOU, China — The U.S. and China agreed to hold talks that will address a key American complaint about China’s economic model, Treasury Secretary Janet Yellen said Saturday on the second day of an official visit to China.
The two sides will hold “intensive exchanges” on more balanced economic growth, according to a U.S. statement issued after Yellen and Chinese Vice Premier He Lifeng held extended meetings over two days in the southern city of Guangzhou.
They also agreed to start exchanges on combating money laundering, the U.S. statement said.
Yellen, who headed to Beijing after starting her five-day visit in one of China’s major industrial and export hubs, said the exchange on balanced growth would create a structure to hear each other’s views and try to address American concerns about manufacturing overcapacity in China.
“I think the Chinese realize how concerned we are about the implications of their industrial strategy for the United States, for the potential to flood our markets with exports that make it difficult for American firms to compete,” Yellen told reporters after the announcement.
“It’s not going to be solved in an afternoon or a month, but I think they have heard that this is an important issue to us.”
China’s official Xinhua News Agency said that the two sides had agreed to discuss a range of issues including balanced growth of the United States, China and the global economy as well as financial stability, sustainable finance and cooperation in countering money-laundering.
It added in an initial dispatch that China had responded fully on the issue of production capacity, but did not provide details. China also expressed grave concern over American trade and economic measures that restrict China, Xinhua said.
Chinese government subsidies and other policy support have encouraged solar panel and EV makers in China to invest in factories, building far more production capacity than the domestic market can absorb.
The massive scale of production has driven down costs and ignited price wars for green technologies, a boon for consumers and efforts to reduce global dependence on fossil fuels. But Western governments fear that that capacity will flood their markets with low-priced exports, threatening American and European jobs.
“It’s going to be critical to our bilateral relationship going forward and to China’s relationship with other countries that are important, and this provides a structured way in which we can continue to listen to one another and see if we can find a way forward that will avoid conflict,” Yellen told reporters.
The exchanges on balanced growth and money laundering will be held under the framework of existing economic and financial working groups that were set up after Yellen met He in July.
Yellen struck a positive note on joint efforts to address U.S. concerns about Chinese companies selling goods to Russia following its invasion of Ukraine.
“We think there’s more to do, but I do see it as an area where we’ve agreed to cooperate and we’ve already seen some meaningful progress,” she said.
Earlier state media coverage of her trip had characterized U.S. concerns about overcapacity as a possible pretext for tariffs. In a commentary published Friday night, Xinhua wrote that while Yellen’s trip is a good sign that the world’s two largest economies are maintaining communication, “talking up ‘Chinese overcapacity’ in the clean energy sector also smacks of creating a pretext for rolling out more protectionist policies to shield U.S. companies.”
Yellen told reporters during an Alaska refueling stop en route to China that the U.S. “won’t rule out” tariffs to respond to China’s heavily subsidized manufacturing of green energy products.
The U.S. has made efforts through legislation and executive orders to wean itself off certain Chinese technologies in order to build out its domestic manufacturing capabilities. Many members of the White House and Congress view the actions as important to maintaining national security.
The $280 billion CHIPS and Science Act passed in 2022 aims to boost the semiconductor industry and scientific research in a bid to create more high-tech jobs in the United States and help it better compete with China. Additionally, last August, U.S. President Joe Biden signed an executive order to block and regulate high-tech U.S.-based investments going toward China.
Yellen will hold meetings in Beijing with more senior officials and economists on Sunday and Monday.
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Moritsugu reported from Beijing.
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Sam Bankman-Fried Sentenced To 25 Years In Prison
Crypto mogul and former CEO of FTX Sam Bankman-Fried was sentenced to 25 years in prison for defrauding hundreds of thousands of customers, leaving investors and lenders short by more than $11 billion. What do you think?
“It’s such a shame, by the time he gets out, he’ll have no idea what all the new scams are.”
Alana Patterson, Slum Developer
“Sooner or later, crypto was going to attract someone only interested in making a quick buck.”
Keaton Singh, Boiling Water Attendant
“There’s no way he can compete with all that alternate prison currency.”
Melanie Potts, Unemployed
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Fallen crypto mogul Sam Bankman-Fried sentenced to 25 years in prison
NEW YORK — Crypto entrepreneur Sam Bankman-Fried was sentenced Thursday to 25 years in prison for a massive fraud on hundreds of thousands of customers that unraveled with the collapse of FTX, once one of the world’s most popular platforms for exchanging digital currency.
Though he described Bankman-Fried as “extremely smart,” U.S. District Judge Lewis A. Kaplan delivered a blistering analysis of Bankman-Fried and his crimes before announcing a sentence that was half of what prosecutors sought and less than a quarter of the 105 years recommended by the court’s probation officers.
“There is absolutely no doubt that Mr. Bankman-Fried’s name right now is pretty much mud around the world,” Kaplan said of the 32-year-old California man who seemed atop the cryptocurrency universe before his businesses collapsed in November 2022, leaving customers, investors and lenders short over $11 billion, which the judge ordered him to forfeit.
He was convicted in November of fraud and conspiracy — a dramatic fall from a crest of success that included a Super Bowl advertisement, testimony before Congress and celebrity endorsements from stars like quarterback Tom Brady, basketball point guard Stephen Curry and comedian Larry David.
Kaplan imposed the sentence in the same Manhattan courtroom where, four months previously, Bankman-Fried testified that he had intended to revolutionize the emerging cryptocurrency market with his innovative and altruistic ideas, not steal.
The judge said Bankman-Fried repeatedly committed perjury on the witness stand in testimony that was “often evasive, hair-splitting, dodging questions.”
Kaplan said the sentence reflected the risk that Bankman-Fried “will be in position to do something very bad in the future. And it’s not a trivial risk at all.” He added that the sentence was fashioned “for the purpose of disabling him to the extent that can appropriately be done for a significant period of time.”
Kaplan said he would advise the Federal Bureau of Prisons to send Bankman-Fried to a medium-security prison near San Francisco because his notoriety, his association with vast wealth, his autism and his social awkwardness are likely to make him especially vulnerable at a high-security facility.
Assistant U.S. Attorney Nicolas Roos had recommended a prison sentence of 40 to 50 years, saying it was the only way to ensure “the defendant doesn’t do it again.”
Prosecutors said tens of thousands of people and companies worldwide lost billions of dollars since 2017 after Bankman-Fried looted FTX customer accounts that he promised were safe to make millions of dollars of illegal political donations, bribe Chinese officials, make risky investments, buy luxury real estate in the Caribbean and live lavishly.
Kaplan agreed with prosecutors Thursday that Bankman-Fried should not be credited because some investors and customers might recover some money. He noted that customers lost about $8 billion, investors lost $1.7 billion and lenders were shorted by $1.3 billion.
When he spoke, Bankman-Fried stood and apologized in a rambling statement: “A lot of people feel really let down. And they were very let down. And I’m sorry about that. I’m sorry about what happened at every stage.”
He added, “My useful life is probably over. It’s been over for a while now, from before my arrest.”
Wearing his khaki-colored prison uniform and chained at the ankles, Bankman-Fried seemed to briefly get emotional as he spoke for about 20 minutes, expressing regret about “a lot of mistakes” but casting some blame onto others. His trademark messy and bushy hair had returned from the trimmer look he displayed at trial.
He praised some of his former executives and workmates, saying: “They threw themselves into it and then I threw all of that away. It haunts me every day.”
Kaplan later criticized Bankman-Fried’s remarks, saying he expressed “never a word of remorse for the commission of terrible crimes.”
As his misty-eyed client looked on, defense attorney Marc Mukasey said the portrayal of the Massachusetts Institute of Technology graduate as an “arrogant greedy swindler who thought he would get away with fleecing the hard-earned money of hard-working people” was wrong.
“Sam was not a ruthless financial serial killer who set out every morning to hurt people,” Mukasey said in court after urging in court papers that any prison sentence be in the single digits. “Sam Bankman-Fried doesn’t make decisions with malice in his heart. He makes decisions with math in his head.”
The judge later criticized Bankman-Fried’s calculations, saying he was indeed “a math nerd, who looked at decisions in terms of math, expected value.”
He cited trial testimony in which Bankman-Fried’s former girlfriend and fellow executive Caroline Ellison said Bankman-Fried once told her that his willingness to embrace risk was such that he’d be happy to flip a coin if it came up tails and the world was destroyed — as long as if it came up heads, the world would be twice as good.
The judge said Bankman-Fried utilized that risk-taking nature at his companies, “betting on expected value” and weighing the risk of getting caught with the probability of large gains.
“That was the game,” Kaplan said. “It’s his nature.”
Bankman-Fried’s attorneys, friends and family had urged leniency, saying he was unlikely to re-offend. They also said FTX’s investors have largely recovered their funds — a claim disputed by bankruptcy lawyers, FTX and its creditors.
“Mr. Bankman-Fried continues to live a life of delusion,” wrote John Ray, the CEO of FTX who has been cleaning up the bankrupt company. “The ‘business’ he left on November 11, 2022 was neither solvent nor safe.”
One FTX customer, Sunil Kavuri, spoke at sentencing, saying he’d traveled from London on behalf of over 200 victims who had sent impact statements to the judge.
He said he’d spoken to other “victims just like myself who had their dreams destroyed” and had lived “the FTX nightmare every day for almost two years, every day, every night, a lot of crying, sleepless nights.”
Bankman-Fried’s parents, both Stanford Law School professors, did not speak as they left the courthouse Thursday, but later issued a statement: “We are heartbroken and will continue to fight for our son.”
Bankman-Fried, of Palo Alto, California, was once worth billions of dollars on paper as the co-founder and CEO of FTX, which was the second-largest cryptocurrency exchange in the world at one time.
FTX let investors buy dozens of virtual currencies, from Bitcoin to more obscure ones like Shiba Inu Coin. Flush with billions of dollars of investors’ cash, Bankman-Fried took out a Super Bowl advertisement to promote his business and bought the naming rights to an arena in Miami.
But the collapse of cryptocurrency prices in 2022 took its toll on FTX, ultimately leading to its downfall. FTX’s hedge fund affiliate, Alameda Research, had bought billions of dollars of various crypto investments that lost considerable amounts of value in 2022. Bankman-Fried tried to plug the holes in Alameda’s balance sheet with FTX customer funds.
Three people from Bankman-Fried’s inner circle pleaded guilty to related crimes and testified at his trial.
Besides Ellison, two onetime friends of Bankman-Fried — Gary Wang and Nishad Singh — testified they felt they were directed by Bankman-Fried to commit fraud.
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Nobel laureate Muhammad Yunus is granted bail in a Bangladesh graft case
DHAKA, Bangladesh — A court in Bangladesh on Sunday granted bail to Nobel laureate Muhammad Yunus in a $2.3 million embezzlement case.
Yunus, who was awarded the Nobel Peace Prize in 2006 for pioneering the use of microcredit to help impoverished people, was sentenced to six months in prison in January on a separate charge of violating labor laws. He was granted bail in that case too and has appealed.
Prosecutor Mir Ahmmad Ali Salam said the embezzlement case involves a workers welfare fund of Grameen Telecom, which owns 34.2% of the country’s largest mobile phone company, Grameenphone, a subsidiary of Norway’s telecom giant Telenor.
“The charges involve the embezzlement of over 250 million takas and money laundering. The accused gave the money to trade union leaders instead of the workers. This way they deprived the ordinary workers of their rightful earnings,” Salam said.
Yunus and seven other defendants appeared in court Sunday and six others were absent.
Defense counsel Abdullah Al Mamun told the court that Yunus, 83, and the others were innocent.
Last year, more than 170 global leaders and Nobel laureates urged Bangladesh’s Prime Minister Sheikh Hasina to suspend legal proceedings against Yunus. His supporters say he has been targeted because of his frosty relations with Hasina. The government has denied the allegations.
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ICC rules that a probe into alleged crimes against humanity in Venezuela may proceed
THE HAGUE, Netherlands — Appeals judges at the International Criminal Court ruled Friday that an investigation into alleged crimes against humanity committed by Venezuelan security forces under President Nicolás Maduro ’s rule during a crackdown on anti-government protests in 2017 may proceed.
Appeals panel Presiding Judge Marc Perrin de Brichambaut said that the court “rejects the appeals” brought by Venezuela.
The ruling was immediately welcomed by the Human Rights Watch advocacy group.
“The ICC decision today is a beacon of hope for the victims of systematic human rights violations by the Maduro government,” it said in a statement. “The decision confirms what these victims already know, with no meaningful justice in Venezuela, the ICC provides an essential path to accountability”.
The court’s chief prosecutor, Karim Khan, announced in late 2021 that he was opening an investigation after a lengthy preliminary probe and an official referral — a request to investigate — in 2018 by Argentina, Canada, Colombia, Chile, Paraguay and Peru.
However, the full-scale investigation was put on hold when Venezuelan authorities said they wanted to take over the case. The ICC is a court of last resort that only takes on cases when national authorities are unwilling or unable to investigate, a system known as complementarity.
Khan pressed ahead with efforts to continue his investigation — the court’s first in Latin America. He said last year that Venezuelan efforts toward delivering justice “remain either insufficient in scope or have not yet had any concrete impact on potentially relevant proceedings.”
ICC judges agreed with Khan and last year authorized him to resume investigations in Venezuela. The judges noted at the time that “Venezuela appears to have taken limited investigative steps and that, in many cases, there appear to be periods of unexplained investigative inactivity.”
Venezuela appealed the ruling, leading to Friday’s decision.
Venezuela’s government said in a statement it is neither “necessary nor appropriate” for the court’s prosecutors to carry out separate or additional investigations and insisted that the alleged crimes against humanity “never occurred.”
“This entire maneuver has been built on the manipulation of a small set of crimes that, as evidenced by all the information provided by Venezuela, have been or are being duly investigated and punished by the authorities of the Venezuelan justice system, in a sovereign manner as established by the constitution,” according to the statement.
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Follow AP’s coverage of Venezuela at https://apnews.com/hub/venezuela
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Trump is backed further into a financial corner after losing control of his company
With Donald Trump’s legal liabilities growing and a presidential campaign to run, losing control of his company couldn’t have come at a worse time.
After a New York judge ordered the Trump Organization to pay $364 million in penalties and barred the former president from any role in running a business in New York state for three years, Trump now finds himself backed further into a financial corner with fewer options for how to maneuver.
“It will have such an enormous impact on the operation of his business,” said Randy Zelin, a professor of law at Cornell University and a veteran criminal defense attorney with experience in complex financial matters. “But it will also provide a strong basis for an appeal.”
New York Attorney General Letitia James had asked New York State Supreme Court Justice Arthur Engoron to levy a $370 million financial penalty against the Trump Organization and also to ban Trump and his children Ivanka, Donald Jr. and Eric Trump from running any company in the state of New York, where his real-estate empire has long been based.
Engoron’s ruling barred Donald Trump Jr. and Eric Trump from being involved in running any business in the state for two years. The judge also ordered that former U.S. District Court Judge Barbara Jones, who has been serving as an independent monitor of the Trump Organization since 2022, continue in that role with expanded powers for the next three years. The ruling also ordered that an independent compliance officer be appointed within 30 days.
“The Trump Organization shall be required to obtain prior approval — not, as things are now, subsequent review — from Judge Jones before submitting any financial disclosure to a third party, so that such disclosure may be reviewed beforehand for material misrepresentations,” the ruling read.
The outcome of the civil trial sat solely in Engoron’s hands, and in September, he issued a summary judgment essentially ruling in favor of James’s arguments that the Trump Organization had engaged in fraud for years by repeatedly misstating the value of assets to lenders and insurance companies.
The judgment is the latest in a string of legal and financial blows that the former president has faced and that have already had an impact on his presidential campaign.
Trump has incurred $76 million in legal costs over the past two years stemming from the wide array of criminal and civil prosecutions he faces. More than $27 million of the money raised in the last six months of 2023 to support his presidential campaign has instead been used to cover his legal costs, according to campaign-finance filings.
A report by Bloomberg earlier this week suggested that Trump may face a cash crunch caused by his ballooning legal costs as early as this summer, just as the presidential race will be heating up.
Last month, a federal jury ordered Trump to pay $83.3 million in damages for defaming the writer E. Jean Carroll, whom he had attacked online after she had accused him of raping her in a department-store dressing room in the 1990s. He had earlier been hit with a $5 million verdict in a state case on similar charges.
Trump has vowed to appeal the verdicts and denied raping Carroll, but in order to appeal, he will be required to put up bonds for the full award amounts. That means he would need to either get a bank to back him or to pledge collateral — like a real estate asset — to secure the bond.
But without full control of his real-estate empire, Trump will likely find it harder to line up financing or use his assets as freely as before.
Under the terms of Engoron’s ruling, Trump will no longer be able to make any moves involving assets held by the Trump Organization without the approval of the court-appointed monitor.
Even pledging his assets as collateral for the bond that he would be required to post in order to file an appeal would be complicated by the imposition of a monitor.
“When you lose control of your company, you lose control of who is going to be paid and how much they will be paid. All the money will, first and foremost, be used to operate the business, and how much goes to Trump and his children becomes a secondary concern,” Zelin said.
Add to that the mounting legal costs for multiple criminal cases being brought against him — on charges related to Jan. 6 as well as charges of mishandling classified documents, election fraud, racketeering and illegally paying hush money to women who claimed they’d had affairs with him — and Trump finds himself in a worsening financial bind.
So far, the former president has managed to cover many of his legal costs through donations from his political supporters, but that means that money won’t be available to fund his campaign for president. At the end of the year, President Joe Biden’s re-election campaign had about $46 million cash on hand, while Trump’s campaign had $33 million, Federal Election Commission filings show. Some $50 million held by Trump’s political action committees has already been used to cover his legal bills.
Regarding the properties held by the Trump Organization, while Trump has been able to refinance many of the loans underlying his bigger real-estate holdings, pushing their maturity dates back several years, he still has a stake in some high-profile buildings that have debt coming due in the next few years.
With the court-appointed monitor part of the equation, it might now be more difficult for Trump to secure new debt in order to refinance those buildings, and that could even technically trigger defaults, depending on how the loan covenants were written.
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Samsung chief Lee Jae-yong is acquitted of financial crimes related to 2015 merger
SEOUL, South Korea — A South Korean court on Monday acquitted Samsung Electronics Chairman Lee Jae-yong of financial crimes involving a contentious merger between Samsung affiliates in 2015 that tightened his grip over South Korea’s biggest company.
The ruling by the Seoul Central District Court could ease the legal troubles surrounding the Samsung heir less than two years after he was pardoned of a separate conviction of bribery in a corruption scandal that toppled a previous South Korean government.
The court said the prosecution failed to sufficiently prove the merger between Samsung C&T and Cheil Industries was unlawfully conducted with an aim to strengthen Lee’s control over Samsung Electronics.
Prosecutors had sought a five-year jail term for Lee, who was accused of stock price manipulation and accounting fraud. It wasn’t immediately clear whether they would appeal. Lee had denied wrongdoing in the current case, describing the 2015 merger as “normal business activity.”
Lee, 56, did not answer questions from reporters as left the court. You Jin Kim, Lee’s lawyer, praised the court for confirming that the merger was legal.
Lee, a third-generation corporate heir who was officially appointed as the chairman of Samsung Electronics in October 2022, has led the Samsung group of companies since 2014, when his late father, former chairman Lee Kun-hee, suffered a heart attack.
Lee Jae-yong served 18 months in prison after being convicted in 2017 over separate bribery charges related to the 2015 deal. He was originally sentenced for five years in prison for offering 8.6 billion won ($6.4 million) worth of bribes to then-President Park Geun-hye and her close confidante to win government support for the 2015 merger, which was key to strengthening his control over the Samsung business empire and solidifying the father-to-son leadership succession.
Lee was released on parole in 2021 and pardoned by South Korean President Yoon Suk Yeol in August 2022, in moves that extended a history of leniency toward major white-collar crime in South Korea and preferential treatment for convicted tycoons.
Some shareholders had opposed the 2015 merger, saying that it unfairly benefited the Lee family while hurting minority shareholders. There was also public anger over how the national pension fund’s stake in Samsung C&T, the merged entity, fell by an estimated hundreds of millions of dollars, after Park had pressured the National Pension Service to support the deal.
Park and her confidante were also convicted in the scandal and enraged South Koreans staged massive protests for months demanding an end to the shady ties between business and politics. The demonstrations eventually led to Park’s ouster from office.
Lee has been navigating one of his toughest stretches as the leader of one of the world’s largest makers of computer chips and smartphones, with Russia’s war on Ukraine and other geopolitical turmoil hurting the world economy and deflating technology spending.
The company last week reported an annual 34% decline in operating profit for October-December quarter as sluggish demands for its TVs and other consumer electronics products offset hard-won gains from a slowly revering memory chip market.
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AP writer Kim Tong-hyung contributed to the story.
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Tesla settles California hazardous-waste lawsuit for $1.5 million
Tesla Inc. will pay $1.5 million to settle a lawsuit filed earlier this week by 25 California counties accusing the electric-vehicle maker of mishandling hazardous waste.
San Francisco District Attorney Brooke Jenkins announced the settlement late Thursday.
“While electric vehicles may benefit the environment, the manufacturing and servicing of these vehicles still generates many harmful waste streams,” Jenkins said in a statement. “Today’s settlement against Tesla, Inc. serves to provide a cleaner environment for citizens throughout the state by preventing the contamination of our precious natural resources when hazardous waste is mismanaged and unlawfully disposed.”
The lawsuit, filed Tuesday, accused Tesla
TSLA,
+0.84%
of improperly handling, transporting and disposing hazardous materials including oil, lead acid batteries, antifreeze and diesel fuel at as many as 101 sites across the state.As part of the settlement, Tesla was ordered to pay $1.3 million in civil penalties, and $200,000 to reimburse the cost of the investigation, which began in 2018. Tesla also must comply with an injunction for five years to properly dispose of its hazardous materials.
Last month, Tesla reported earnings of $7.9 billion in the fourth quarter.
Tesla, which dissolved its media relations team in 2020, did not respond to a request for comment.
Tesla shares are down about 24% year to date, compared to a 3% gain by the S&P 500
SPX. -
Judge dismisses Disney’s free-speech lawsuit against DeSantis
Walt Disney Co.’s lawsuit against Florida’s Republican Gov. Ron DeSantis and others, alleging they retaliated against the company for publicly criticizing a controversial parents-rights education law backed by DeSantis, was dismissed by a federal judge on Wednesday.
Shares of Disney
DIS,
-0.92%
fell about 1% Monday.Judge Allen Winsor ruled Disney lacked legal standing to sue DeSantis. He added that Disney’s charges “fail on the merits” against members of the Florida board of a special improvement district in which the company operates its parks and resort.
In his ruling, Winsor said Disney “has not alleged any specific actions the new board took (or will take) because of the governor’s alleged control.” He added the company “has not alleged any specific injury from any board action.”
“Its alleged injury … is its operating under a board it cannot control. That injury would exist whether or not the governor controlled the board,” he wrote.
Disney strongly suggested it will appeal Winsor’s ruling.
“This is an important case with serious implications for the rule of law, and it will not end here,” the company said in a statement. “If left unchallenged, this would set a dangerous precedent and give license to states to weaponize their official powers to punish the expression of political viewpoints they disagree with. We are determined to press forward with our case.”
The controversial legislation, dubbed “Don’t Say Gay” by critics, was passed in 2022.
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Mother of disabled girl who was allegedly raped in Starbucks bathroom sues company, school district
The mother of an intellectually disabled girl who was allegedly led from school grounds by three male students and sexually assaulted in a Starbucks bathroom and a nearby empty building filed a lawsuit Wednesday accusing Starbucks, Pittsburgh Public Schools and a property management company of negligence.
The lawsuit alleges that school personnel at Taylor Allderdice High School failed to provide adequate supervision and care of the girl during school hours and during transportation to and from school. It alleges that both the property management company 101 Kappa Drive Associates #1 and Starbucks managers were aware of the increasing crime issues near their businesses and failed to provide security or training for employees on how to respond to and report criminal activities.
“Pittsburgh Public Schools failed to create a safe environment for my client to go to and from school when it knew that she needed one. And Starbucks and Kappa failed to protect my client from the violence of others when they knew their businesses were causing criminal activity to occur. The painful result was her sexual assault,” said attorney Alec Wright, who represents the girl and her mother in the lawsuit.
The lawsuit alleges that the then 15-year-old girl, whose name was withheld in the lawsuit, was led off campus by three male students in October 2022. The lawsuit alleges that Starbucks employees witnessed the male students taking turns entering the bathroom with the girl and did not intervene. The alleged assailants then took her to an empty building managed by Kappa, where the third boy sexually assaulted the girl, according to the lawsuit filed in Allegheny County Court of Common Pleas.
At first, the girl was unable to communicate to her mother what happened to her. But days later the mother said she was notified by the school that the girl was found crying at a lunchroom table alone because of a rumor that three boys had sex with her. The mother said she met with school officials who were then notified that the incident occurred at Starbucks, and not at the school as officials initially suspected.
The mother took the girl for a medical exam that she said showed positive signs of sexual assault. She reported the assault to police, but more than a year later police have not filed charges.
A spokesperson for the Pittsburgh Department of Public Safety said the case had been closed and that the county district attorney’s office had determined it would not pursue charges.
A message seeking comment was sent to corporate communications for Seattle-based Starbucks. A phone number was not available for Kappa, but The Associated Press left a message with a real estate company that handles rentals at several Kappa properties.
A spokesperson for Pittsburgh Public Schools said the district does not comment on pending litigation.
Pittsburgh Public Schools provides public transportation bus passes to high schoolers who live within 2 miles (3 kilometers) of their school and to younger students who live within 1.5 mile (2.4 kilometers) of their school. At Taylor Allderdice High School, district officials had negotiated with Pittsburgh’s public transportation authority to move the public transit bus stop that many students use to the location in front of the Starbucks.
The girl’s mother notified school officials that her daughter would need help adjusting to high school and with taking public transportation to school, according to the lawsuit. The lawsuit notes the girl’s IQ during evaluation was determined to be around 65, and then below 60 on a second test, placing her in the lowest 1% of students intellectually.
However, the lawsuit alleges that during her first months at the high school, the girl was left unsupervised and allowed to either wander the halls or hide in the bathroom during her classes. The tardy and attendance policy was not enforced because of her disabilities, and staff failed to address her leaving class or provide any safety monitors for her during school hours or en route to and from the bus stop, according to the lawsuit.
“It just makes me feel angry to know that there was such little oversight or protection for my daughter. If she leaves in the morning to go to school, then she should return home from school safe,” the girl’s mother said. “Taylor Allderdice let her be lured off campus, and Starbucks let her be attacked in its bathrooms. It’s all just so frustrating and disheartening. It’s just very hard to describe.”
The Associated Press does not name victims of sexual assault or abuse unless they come forward publicly. The names of both the girl and her mother were withheld from the lawsuit to protect the girl’s identity.
The lawsuit alleges the male teens were given unrestricted access to the girl when they were able to lead her off campus to the Starbucks bus stop, where school officials did not provide any safety monitors during prime transportation hours despite knowing about increased incidents of student-based violence and other negative activities.
The month before the sexual assault occurred, a large group of students got into a fight at the bus stop. A police officer was injured while trying to break up the fight and police shocked two students with Tasers during the incident.
Owners of businesses in the same building as the Starbucks have reported harassment of customers, a storefront window being broken, students challenging business owners to fights and other issues with drugs and vandalism. At least one business owner has asked the school district to move the bus stop during school board meetings.
The lawsuit alleges that Starbucks and Kappa failed to respond to the widely known issues with crime, violence and mischief by not creating policies or conducting trainings for employees on how to keep themselves or patrons safe, and by not providing security measures like guards during high traffic times.
The lawsuit alleges that Starbucks employees allowed students largely unrestricted access to its bathrooms partly because the students increased the store’s sales.
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Appeals court reverses judge's ruling, orders appointment of independent examiner in FTX bankruptcy
DOVER, Del. — A federal appeals court has ordered the appointment of an independent examiner in the bankruptcy case of FTX amid concerns about widespread fraud preceding the collapse of the multibillion-dollar cryptocurrency exchange.
A three-judge panel in Philadelphia issued the ruling Friday in an appeal filed by the U.S. bankruptcy trustee, who serves as a government watchdog in Chapter 11 reorganizations. Lawyers for the trustee had argued that FTX’s financial affairs and business operations, including allegations of unprecedented fraud leading to its collapse, should be reviewed by a disinterested person, not left to an internal investigation.
U.S. Bankruptcy Judge John Dorsey denied the trustee’s request last February. He agreed with FTX and its official committee of unsecured creditors that an examiner’s work would be too costly and would duplicate investigations already under way by FTX’s new leadership, the creditors committee and several federal agencies. Dorsey also expressed confidence in John Ray III, who was appointed by FTX co-founder Sam Bankman-Fried as the company’s new CEO on the same day the company sought bankruptcy protection.
Bankman-Fried is awaiting sentencing in March after being convicted in November on wire-fraud and conspiracy charges. Several other former FTX executives have pleaded guilty to similar charges. Prosecutors said Bankman-Fried siphoned billions of dollars from customer accounts at FTX into his cryptocurrency hedge fund, Alameda Research.
The appeals court reversed Dorsey’s ruling, agreeing with the trustee that the bankruptcy code mandates the appointment of an examiner.
“Sometimes highly complex cases give rise to straightforward issues on appeal,” Judge Luis Felipe Restrepo wrote for the panel. “Such is the case here.”
Restrepo also noted that an examiner is required to make his or her findings public, whereas a debtor or creditors committee conducting an internal investigation has no such obligation.
“The collapse of FTX caused catastrophic losses for its worldwide investors but also raised implications for the evolving and volatile cryptocurrency industry,” the judge wrote, noting that further scrutiny of FTX could alert potential investors to undisclosed credit risks in other cryptocurrency companies.
“In addition to providing much-needed elucidation, the investigation and examiner’s report ensure that the bankruptcy court will have the opportunity to consider the greater public interest when approving the FTX Group’s reorganization plan,” he added.
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JetBlue, Spirit Airlines appeal court ruling blocking their proposed merger
JetBlue Airways Corp. and Spirit Airlines Inc. said late Friday that they have appealed a court ruling that earlier this week blocked their planned merger.
JetBlue
JBLU,
-1.19%
and Spirit
SAVE,
+17.19%
announced the appeal in a terse press release that provided no more details, adding only that the process is “consistent with the requirements of the merger agreement.”Wall Street was split on whether the airlines would be legally obliged to appeal the Tuesday ruling, which sided with the Justice Department in saying that a merger between low-cost JetBlue and ultra-low-cost Spirit would hurt competition.
Shares of Spirit rallied 12% after hours Friday, while JetBlue shares fell nearly 2%. Analysts at JP Morgan said this week that the ruling freed JetBlue from a “costly merger.”
Earlier Friday, Spirit sought to reassure investors about its liquidity and issued an upbeat fourth-quarter revenue guidance. Spirit has amassed about $5.5 billion in debt, and is reportedly seeking advisers to help restructure it.
The likelihood of Spirit attracting a new merger or takeover bid is considered low without a debt restructuring. Frontier Group Holdings Inc.
ULCC,
-2.13%
and JetBlue competed for Spirit in 2022, with Frontier ultimately bowing out in July of that year.Raymond James analyst Savanthi Syth said in a note earlier Friday that it was “clear to us that Spirit is pressing JetBlue to appeal the antitrust ruling, but we continue to believe the chances of success are low.”
Syth has estimated that an appeal would take some four to five months.
Shares of Spirit have lost 67% in the past 12 months, while shares of JetBlue are down 41%. The U.S. Global Jets ETF
JETS
has lost 9% in the same period. Those losses contrast with gains of 24% for the S&P 500 index
SPX. -
Rays shortstop Wander Franco faces lesser charge as judge analyzes evidence in ongoing probe
SANTO DOMINGO, Dominican Republic — SANTO DOMINGO, Dominican Republic (AP) — Wander Franco is facing a lesser charge after a judge in the Dominican Republic analyzed evidence that alleges the Tampa Bay Rays shortstop had a relationship with a 14-year-old girl and paid her mother thousands of dollars for her consent.
Originally accused of commercial and sexual exploitation and money laundering — charges that carry up to 30 years, 10 years and 20 years of prison respectively — Franco now stands accused of sexual and psychological abuse, according to a judge’s resolution that The Associated Press obtained on Tuesday.
Franco has not been formally accused, but if found guilty on the new charge, he could face between two to five years in prison.
In his decision, Judge Romaldy Marcelino observed that prosecutors gave the case against Franco a different and more serious treatment because “the accused is a professional MLB player,” he said, referring to Major League Baseball. He didn’t elaborate.
The judge also determined that the money Franco is accused of giving the teen’s mother cannot be considered payment for the girl’s alleged services since the mother requested money after finding out about their relationship, which lasted four months, according to evidence collected by prosecutors.
The girl’s 35-year-old mother also is charged in the case and remains under house arrest. The original charges of money laundering still stand against her. The AP is not naming the woman in order to preserve her daughter’s privacy.
Franco was conditionally released Monday from a jail in the northern province of Puerto Plata after being detained for a week. He was ordered to pay 2 million Dominican pesos ($34,000) as a type of deposit and is required to meet with authorities once a month in the Dominican Republic as the investigation continues.
Franco was having an All-Star season before being sidelined in August, when Dominican authorities began investigating claims he had been in a relationship with a minor. Major League Baseball launched its own investigation, placing Franco on the restricted list on Aug. 14 before moving him to administrative leave on Aug. 22. Both investigations are ongoing.
Franco signed a $182 million, 11-year contract in 2021. His salary last year and this year is $2 million per season.
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Follow AP’s coverage of Latin America and the Caribbean at https://apnews.com/hub/latin-america
