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A new twist in a Russian scandal
The Russian Interior Ministry is about to seek the arrest of William Browder, the chief executive of Hermitage Capital Management, for illegally evading taxes. That’s according to a front-page article in the Russian newspaper Kommersant, a leading political-economic daily.
Browder, a British and US citizen who resides in London, has been denied entry into Russia ever since 2005, when his visa was annulled for obscure reasons. His Hermitage Fund, managed by the British bank HSBC, was once the largest portfolio investor in Russia, but has more recently been embroiled in a series of interconnected scandals.
Today’s newspaper article, based on anonymous sources within the Russian police, is evidently the latest shot in a long-running media war that has pitched Hermitage against elements of the Russian police. Over the last year and a half, the British investment fund has made a series of sensational allegations, claiming that senior Russian police officers were involved in a corruption scam designed to fleece the Russian budget of hundreds of millions of dollars.
Following these claims, Russian authorities have been busy upping the pressure against the Fund. A lawyer working for Hermitage in Russia, Sergei Magnitsky, was arrested last November, and his trial in Moscow is due to begin shortly. Today’s Kommersant article lays out the case that the police intend to bring against Magnitsky, which relates to alleged underpayment of taxes by two Hermitage subsidiaries several years ago.
According to the sources cited in the newspaper, Browder is also implicated, and investigators now intend to approach Interpol with a request to place him on the international wanted list. The paper quotes Hermitage’s view that the case is fabricated “to discredit Hermitage Capital”.
Given the circumstances, the latest allegations against Browder will command little credibility outside Russia. According to court documents recently submitted by Hermitage in the US, the criminal case against Magnitsky was initiated by the same police officers previously accused by Hermitage.
If Russia does request Browder’s arrest and extradition, legal authorities in Britain are also likely to consider the findings of a recent report into the case by the Parliamentary Assembly of the Council of Europe, which slams Russia’s criminal justice system. The report states that Hermitage was “the victim of the corruption and collusion of senior police officials and organised criminals.”
A Goldman trading scandal?
Did someone try to steal Goldman Sachs’ secret sauce?
While most in the US were celebrating the 4th of July, a Russian immigrant living in New Jersey was being held on federal charges of stealing top-secret computer trading codes from a major New York-based financial institution—that sources say is none other than Goldman Sachs.
The allegations, if true, are big news because the codes the accused man, Sergey Aleynikov, tried to steal is the secret code to unlocking Goldman’s automated stocks and commodities trading businesses. Federal authorities allege the computer codes and related-trading files that Aleynikov uploaded to a German-based website help this major “financial institution” generate millions of dollars in profits each year.
The platform is one of the things that apparently gives Goldman a leg-up over the competition when it comes to rapid-fire trading of stocks and commodities. Federal authorities say the platform quickly processes rapid developments in the markets and uses top secret mathematical formulas to allow the firm to make highly-profitable automated trades.
The criminal case has the potential to shed a light on the inner workings of an important profit center for Goldman and other Wall Street firms. The federal charges also raise serious questions about the safeguards Wall Street firms deploy to protect their proprietary trading systems.
The criminal case began to unfold on the evening of July 3 when Aleynikov was arrested by FBI agents at Newark Liberty Airport, after returning from Chicago. Aleynikov had just started a job with another firm in Chicago, after leaving the big firm in NY in early June. It appears the financial institution allegedly victimized by Aleynikov had alerted federal authorities that its former employee might be up to no good.
On July 4, Aleynikov was processed on a “theft of trade secrets” charge in a criminal complaint that was filed in federal court in Manhattan. As of this afternoon, he was still being held in federal custody pending posting of bail.
This type of activities supports global recession. Definitely we need a system who will responsible for auditing suspicious activities in trading system.
Regards
http://www.quagnitia.com
Allen Stanford’s many lives
The clock is still ticking on what would appear to be an inevitable indictment for disgraced Texas financier R. Allen Stanford, the man who allegedly ran an $8 billion Ponzi scheme out of his Antigua-based bank. It appears the federal prosecutors manning the investigation are trying to make sure they have an airtight case before filing criminal charges–something Stanford and his lawyer expect will happen any day.
At first blush, it’s hard to fathom why it should take this long for prosecutors to file charges, given that Stanford and two of his top associates were the subject of a civil action by the Securities and Exchange Commission nearly three months ago. One of those associates, Laura Pendergest-Holt, has even been indicted on federal obstruction of justice charges. But still nothing on Stanford.
Bryan Burroughs, in the most recent issue of Vanity Fair, does a good job detailing how just about every US investigative agency was on Stanford’s tail for more than 15 years. But whether it was allegations of money laundering, or fleecing investors with the sale of dubious CDs, no one was ever able to get the goods on Stanford.
In fact, I’m told Houston and New Orleans agents from DEA and IRS even considered running an ABSCAM-style sting on Stanford in 1998. The plan called for the agencies to work together and rent a yacht and throw a party with undercover agents posing as big-time drug dealers. The agencies planned to invite Stanford and some of his cronies to the party to see if he’d be willing to do business with the drug dealers. In other words, help them hide the proceeds from their illegal trade. The sting never happened. It’s not entirely clear why.
Ironically, a year later, DEA agents in Miami would praise Stanford as being one of the good guys in agreeing to turn over money that a group of alleged drug dealers had stashed away in an account at his Antigua-based bank. Again, it’s not clear if the Miami agents knew about the aborted sting the Houston agents had discussed.
Sure, a lot of the difficulty in going after Stanford stemmed from the simple fact that he kept the core of his operation in a tiny country, whose political leaders were all too cozy with the native Texan and dependent on his largess to fuel the nation’s economy. But there probably also was a simple lack of will on the part of the SEC, FBI, DEA and IRS to follow things through, in part because so many of Stanford’s banking customers were Latin Americans.
Or, as Burroughs describes, may be it was the aggressive lobbying by the investigative firm Kroll that tamed the authorities looking into Stanford. And, of course, don’t rule out the impact of inter-agency turf battles making it difficult for anyone investigative agency to take the lead and bring Stanford to justice.
Allen Stanford’s school of serial swindlers use name dropping, stamped passports, falsified tax returns, and donations to St. Jude’s to gain trust and power over private companies with aspirations to go public. According to SEC files, Sydney Trip Camper botched a deal with the Ahkoy family’s Datec and was fired from Elandia Inc. by Allen Stanford. With help from his new partner in crime, Sydney Camper went on to his next victim in Los Angeles and ruined this private company by forming a shell holding company, opening secret bank accounts, and using all THEIR assets to get OTHER people to loan HIM money = PONZI SCHEME!!!! In true Stanford form, Sydney Camper moved on to InZon and Ed Berkhof is orchestrating a new scam with FMC Telecom. Frank Cassidy, owner of FMC Telecom, is either his new fellow fraudster or Mr. Cassidy has fallen victim to Ed Berkhof’s new Ponzi scheme. The FBI and SEC are investigating Allen Stanford, James M. Davis and their den of thieves including Sidney D. Trip Camper III and Ed Berkhof.
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The Wall
Why doesn’t Russia just do what it always does?
The old political trick known as “Police arrest the dissenter followed by him somehow getting accidently shot by a police handgun in the car, and then accidently falling out of the car and then somehow falling from a second story building onto pavement”.
Seriously. The Soviet Union may have collapsed. But the same people are in charge. They have no issue with cronyism or corruption, because these are the things the Russian government use to control the nation.