A former Mayor in a small, New York village in the Hamptons will serve 8 years in prison after his conviction on federal securities fraud charges.
According to an AP report, George Motz, the former Mayor of Quogue, N.Y., also was president and CEO of Melhado, Flynn and Associates.
In that role, he admitted to a scheme known as “cherry picking” in which he secretly placed the more profitable stock trades into his own account and less profitable ones into his clients’ accounts.
The fraud scheme netted Motz about $2.2 million personally, according to federal charges.
The FTC has accused Hingham clothing retailer Talbots of making at least 3.4 million telemarketing calls in 2009 for its Talbots and J. Jill brands.
The prerecorded sales pitches violated federal law intended to protect consumers against intrusive telemarketing.
The FTC said Talbots failed to let customers know right away that they could press a button or call a toll-free number to be added to the company’s Do Not Call list.
A judge may issue a permanent injunction barring Talbots from future violations and order the company to pay civil penalties, which carry a maximum penalty of up to $16,000 per violation.
Con artists in several states are seizing on the public’s financial struggles and confusion about the recent health care overhaul, according to authorities.
So far, the frauds appear to be relatively infrequent and are often no more than spam fax messages with blatant misspellings and no company letterhead.
However, authorities are warning consumers of the bogus plans, which have names like Obamacare and Obama Health Plan and promise affordable compliance with the new law.
The fraudsters also often impersonate insurance agents and government workers.
Toyota will pay 16.4 million dollars in charges for not notifying the US government the safety issues its cars had in timely manner.
This was arguably the largest penalty the Department of Transportation had put on any company.
Lawyers may now be able to argue that Toyota committed consumer fraud since the settlement means the automaker accepts responsibility for hiding the defects.
While charges of racketeering are very difficult to prove, judges are very strict and sometimes may triple the penalty.
Goldman Sachs is planning a vigorous defense against federal fraud charges filed earlier this week.
And it appears Wall Street’s biggest and most influential investment firm is going to the court of public opinion months before it faces the charges in a trial.
The Securities and Exchange Commission believes Goldman Sachs deceived its investors because mortgage securities were secretly funded to fail, and that a Goldman client was standing to benefit from the failures.
When these securities did fail, it set off a chain reaction across the country and soon the entire housing market was in freefall, and thousands of Goldman Sachs investors were out of up to $1 billion.
Goldman Sachs said in response to the charges, that its clients were aware of the risk involved with the mortgage securities and hid nothing from them.
It said the case the SEC has presented thus far doesn’t amount to securities fraud, and doubts the government has any more evidence of fraud.
A former top attorney for the SEC was found to have quashed numerous investigations of accused swindler R. Allen Stanford according to an internal review.
Spencer Barasch, the former head of enforcement for the SEC in Fort Worth, also repeatedly attempted to be Stanford’s defense attorney.
He quit the case when the SEC told him repeatedly that he was violating federal ethics rules.
The report did not suggest Barasch knew Stanford while he worked at the SEC.
Barasch, 52, now a partner with Dallas, Texas law firm Andrews Kurth.
The federal government has charged Wall Street’s most influential investor, Goldman Sachs & Co., of fraud.
The company, authorities say, didn’t tell its investors that mortgage securities it sold were crafted by a man betting on them to fail.
Goldman Sachs’ client, Paulson & Co., is accused of gaining at least $1 billion in the investment fraud. Thousands of investors lost at least that amount over time with the once-trusted name on Wall St.
The Goldman Sachs fraud ring is believed to have been behind the massive housing market failure that’s put thousands or more out of their homes, and more out of jobs.
When Paulson’s bubble burst, it send financial markets into tail-spin, and has left the country reeling in massive recession.
Goldman Sachs has defended its previous actions and called the government’s accusations “completely unfounded in law and fact,” according to an AP report.
The Securities and Exchange Commission wants to get lost investment money back from Goldman Sachs, and is likely to impose massive civil fines against the firm.
Regulators believe Paulson paid Goldman Sachs $15 million three years ago to create an investment scheme tied to mortgage securities that were likely going to decline in value over time. Paulson then purchased an insurance that gained him a profit when those securities failed.
Two European banks are believed to have lost another $1 billion from buying these securities.
The SEC, after having hit Goldman Sachs Group Inc with a civil fraud charge, is investigating other mortgage deals arranged by some of Wall Street’s biggest firms.
Among the firms that created mortgage deals that soon went sour were Deutsche Bank AG, UBS AG and Merrill Lynch & Co, now owned by Bank of America Corp.
At the beginning of the housing market crash, some financial firms may have designed products to allow key clients to bet on a sharp housing downturn.
Soured mortgage investments helped trigger the near-collapse of American International Group Inc, which had insured at least $1 billion of bond deals issued by Wall Street firms in 2005.
Top executives at Washington Mutual knew about rampant fraud in the banks’ home lending arena, and did little if anything in response, according to reports.
An internal investigation at the bank revealed that two of the top-producing offices making subprime loans in southern California were riddled with fraud.
At one office, in Downey, 58 percent of mortgages were found to be fraudulent; at another office in Montebello, 83 percent were fraudulent.
These revelations were sent to David Schneider, president of Home Loans. Bank CEO Kerry Killinger was also said to have been informed of the internal reviews.
Shoe maker New Balance continues to flaunt rules on the “Made in USA” tagline.
In 1997, the Federal Trade Commission ruled that all or virtually all of a product’s materials had to be made in the U.S. for a finished good to be considered “Made in USA”. At the time, the rules caused a row between the government and the shoe maker.
Today, New Balance maintains its belief that its sneakers are made in America despite only 70 percent of the materials used to craft them being from the U.S.
The claim is a unique trait for New Balance in the competitive sneaker market. American companies like Nike base much of its operations overseas.
New Balance says its sneakers are assembled in the U.S. by American workers, but materials for them are clearly gained from foreign sources.
The FTC rule on the Made in America claim are confusing, according to an AP report, but the former FTC chair who wrote the rule believes New Balance is flaunting vagueries in the language.
A current FTC attorney believes the rule means that all or nearly every material in a product must have derived from a domestic source for a finished product to be considered “Made in USA”.