Four Businessmen and Two Foreign Officials Plead Guilty in Connection with Bribes Paid to Mexican Aviation Officials

Charges were unsealed against six individuals, all of whom have pleaded guilty for their involvement in schemes to bribe Mexican officials in order to secure aircraft maintenance and repair contracts with government-owned and controlled entities, and two for conspiring to launder the proceeds of the schemes.     

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, U.S. Attorney Kenneth Magidson of the Southern District of Texas, Special Agent in Charge Mark Dawson of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (ICE-HSI) in Houston, Special Agent in Charge Shane Folden of ICE-HSI in San Antonio and Special Agent in Charge Rick Goss of Internal Revenue Service-Criminal Investigation’s (IRS-CI) Houston Field Office made the announcement.

“The six convictions announced today demonstrate the department’s commitment to holding accountable those who further official corruption through bribery,” said Assistant Attorney General Caldwell.  “These convictions are the result of a coordinated effort by prosecutors and agents who built the cases brick by brick using traditional law enforcement techniques.” read more »

Redflex Traffic Systems Enters into Non-Prosecution Agreement with United States

Redflex Traffic Systems is wholly owned by Redflex Holdings Group of Melbourne, Australia, which owns and operates a network of digital speed and red-light cameras worldwide.  The company installs cameras that automatically record and ticket drivers who run red lights.  As part of the non-prosecution agreement, Redflex accepted responsibility for its conduct related to the illegal activities of its employees in recent U.S. investigations.

Its former CEO was convicted as part of the probes into bribes paid to elected officials to procure or expand Redflex’s contracts with Chicago and Columbus.  The investigations also resulted in the convictions of a Chicago official and a Columbus lobbyist.  John Bills, a former Chicago assistant transportation commissioner, was convicted of accepting cash and benefits from Redflex in exchange for expanding the company’s business with Chicago.  The lobbyist, John Raphael, pleaded guilty to extorting cash from Redflex to pass on to elected officials in Ohio in an effort to obtain red-light camera contracts. read more »

U.S. accuses Chinese citizens of hacking law firms, insider trading

Three Chinese citizens have been criminally charged in the United States with trading on confidential corporate information obtained by hacking into networks and servers of law firms working on mergers, U.S. prosecutors said on Tuesday.

Iat Hong of Macau, Bo Zheng of Changsha, China, and Chin Hung of Macau were charged in an indictment filed in Manhattan federal court with conspiracy, insider trading, wire fraud and computer intrusion.

Prosecutors said the men made more than $4 million by placing trades in at least five company stocks based on inside information from unnamed law firms, including about deals involving Intel Corp and Pitney Bowes Inc. read more »

SEC Charges Lawyer With Stealing Investor Money in EB-5 Offerings

The Securities and Exchange Commission today charged a California-based attorney with defrauding investors seeking to participate in the EB-5 immigrant investor program, stealing their money to buy a yacht and prop up his other businesses.

The SEC alleges that Emilio Francisco raised $72 million from investors in China solicited through his marketing firm PDC Capital to invest in EB-5 projects that included opening Caffe Primo restaurants, developing assisted living facilities, and renovating a production facility for environmentally friendly agriculture and cleaning products.  Under the EB-5 program, foreign investors can apply to permanently live and work in the U.S. by investing money in certain projects that bring about American jobs.

According to the SEC’s complaint, Francisco and PDC Capital diverted investor funds from one project to another and outright stole at least $9.6 million that was used to finance Francisco’s own businesses and luxury lifestyle.  Francisco was allegedly aware that doing so would violate federal regulations and jeopardize any visas for the foreign investors. read more »

CFTC Charges Brett G. Hartshorn of Sarasota, Florida with Soliciting at Least $906,000 in an Off-Exchange Foreign Currency Fraud Scheme

The U.S. Commodity Futures Trading Commission (CFTC) filed a civil enforcement action in the U.S. District Court for the Southern District of New York, charging Brett G. Hartshorn of Sarasota, Florida, with fraudulently soliciting and/or managing at least $906,000 from retail clients to invest in off-exchange foreign currency (forex), misappropriating at least $57,414 of client funds for his own personal benefit, failing to register with the CFTC as a Commodity Trading Advisor (CTA), and failing to produce books and records to the CFTC. read more »

U.S. Justice Dept. orders whistleblower to testify in Wells Fargo probe

The U.S. Department of Justice has subpoenaed a high-profile whistleblower in its criminal investigation into Wells Fargo & Co's opening of accounts without customer permission.

U.S. prosecutors in San Francisco have asked Wells Fargo banker Yesenia Guitron, who lost a private lawsuit against the fourth-largest lender, to testify before a grand jury in San Francisco on Tuesday, according to a subpoena dated Dec. 12, which was seen by Reuters.

A Wells Fargo spokesman declined to comment.

Guitron is among at least five Wells Fargo employees who sued the bank or filed complaints with regulators alleging that they were fired after reporting the opening of customer accounts without their permission, according to a Reuters review of lawsuits and complaints to the U.S. Labor Department. read more »