Securities Law

Controversy Follows Madoff Lawyer, Who Got First Death Threat in 1975

Bernard Madoff’s lawyer, Ira Lee Sorkin, has had a long-held fascination with securities law—and a longtime ability to attract controversy. Sorkin became “smitten” during his first exposure to securities litigation as a Manhattan intern in the federal prosecutor’s office in 1967, the New York Times reports. After graduating from law…

Mar 12, 2009 4:11 PM CDT

‘08 Class Actions & Awards Drop—But Not for Long, Magazine Predicts

Both the number of securities class actions and the amount of money they earned for plaintiffs dropped in 2008, a new report says. But the downturn won’t last for long, predicts CFO magazine. For one thing, the article points out, when one area of securities practice falls, plaintiffs attorneys generally…

Mar 11, 2009 10:25 PM CDT

Stanford Takes Fifth in SEC Civil Case over Alleged $8B Fraud

After a former chief investment officer for the Stanford Financial Group at least arguably said too much in testimony before the U.S. Securities and Exchange Commission, chairman and sole shareholder R. Allen Stanford isn’t going to make the same mistake. In an affidavit included in a federal court filing today…

Mar 11, 2009 9:31 PM CDT

Madoff to Plead in 11-Count Case, Faces Likely Life Sentence

The luxe house-arrest life is apparently about to end for Bernard Madoff. Confirming earlier news that a guilty plea is expected, Madoff’s lawyer said in a Manhattan court hearing today that his client will plead guilty in an 11-count federal criminal case concerning his alleged $50 billion Ponzi scheme, according…

Mar 10, 2009 8:31 PM CDT

Receiver Seeks Clawback of Legal Fees Paid to Paul Hastings & Fulbright Firms

Asked by a federal judge in Utah to recover money on behalf of investors allegedly fleeced by a claimed Ponzi scheme operator, Val Southwick, a receiver has focused on two major law firms. Contending that money from the Ponzi scheme was used to fund legal defense fees, the receiver filed…

Mar 10, 2009 6:12 PM CDT

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

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

Mar 10, 2009 12:03 AM CDT

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

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

Mar 6, 2009 6:48 PM CST

Madoff Losses Could Be Closer to $20 Billion

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

Mar 6, 2009 12:05 PM CST

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

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

Mar 4, 2009 2:35 PM CST

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

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

Mar 4, 2009 12:54 AM CST

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

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

Mar 3, 2009 8:50 PM CST

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

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

Mar 3, 2009 5:54 PM CST

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

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

Mar 3, 2009 12:05 PM CST

Amended SEC Complaint Accuses Stanford, CFO of Running Ponzi Scheme

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

Mar 2, 2009 12:11 PM CST

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

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

Feb 27, 2009 12:45 PM CST