CFTC Strengthens Anti-Retaliation Protections for Whistleblowers and Enhances the Award Claims Review Process

The U.S. Commodity Futures Trading Commission unanimously approved amendments to the CFTC’s Whistleblower Rules that will, among other things, strengthen the CFTC’s anti-retaliation protections for whistleblowers and enhance the process for reviewing whistleblower claims.

Based on a reinterpretation of the CFTC’s anti-retaliation authority under the Commodity Exchange Act, the CFTC or the whistleblower may now bring an action against an employer for retaliation against a whistleblower. The amendments also prohibit employers from taking steps to impede a would-be whistleblower from communicating directly with CFTC staff about a possible violation of the CEA by using a confidentiality, pre-dispute arbitration or similar agreement.

“The Whistleblower Program is an integral part of the Division’s efforts to identify and prosecute unlawful conduct. The Commission’s approval of these rules today will further strengthen and enhance our efforts to protect customers and promote market integrity,” said James McDonald, the Director of the Division of Enforcement. read more »

 

UnitedHealth Overbilled Medicare by Billions, U.S. Says in Suit

The Justice Department has sued UnitedHealth Group, saying that senior executives knew the company was overbilling Medicare by hundreds of millions of dollars a year, and halted a repayment plan in 2014 so the money could be used to meet Wall Street’s revenue expectations.

In a complaint filed Tuesday in United States District Court in Los Angeles, the Justice Department said UnitedHealth routinely combed through millions of patients’ medical charts, searching for data it could use to make patients look sicker than they really were, in what the lawsuit called “strictly a one-sided revenue generating program.”

Under the government’s popular old-age health program, Medicare Advantage, reporting unhealthier customers led to bigger payments from the federal government — $3 billion worth to UnitedHealth from 2010 to 2015 alone, according to the complaint. The Justice Department said misrepresenting people’s health was a civil fraud and sued for triple damages and other penalties. read more »

No Movie Could Capture the Crazy Details of Bernie Madoff's Story

Bernie Madoff is back, nearly a decade after his arrest for the largest known financial fraud in history. An HBO movie, The Wizard of Lies, starring Robert De Niro, premieres on Saturday, and Madoff, an earlier ABC miniseries starring Richard Dreyfuss, have catapulted the preeminent Ponzi schemer into the limelight again, even as lawsuits to recover his investors’ losses continue to grind on in the courts.

It’s fitting that Madoff is played by such skilled actors as De Niro and Dreyfuss, both of whom have won Academy Awards: Madoff, who has been serving a 150-year sentence since 2009 for bilking thousands of investors in a Ponzi scheme, was himself a gifted actor, whose special talent for lying enabled him to bamboozle the naive and sophisticated alike. read more »

Citigroup Agrees to $97.4 Million Settlement in Money Laundering Inquiry

For years, Citigroup employees suspected that millions of dollars that the bank was moving to Mexico might be suspicious. Yet the bank, federal prosecutors said on Monday, failed to sufficiently alert regulators or step up its monitoring for money laundering.

Even as the Citigroup unit Banamex USA was growing to dominate the business of remittances from the United States to Mexico, the bank did not properly safeguard its systems from being infiltrated with drug money and other illicit funds, prosecutors said.

On Monday, Citigroup agreed to settle a long-running federal investigation into Banamex USA and pay $97.4 million. In exchange, the Justice Department will not charge the bank criminally for the misdeeds of Banamex USA, based in California. read more »

Video: What's an Algorithm, and How Do Quants Use Them?

Algorithms are sets of rules used to help drive active decision-making. And they're lurking behind nearly every aspect of financial life. read more »

Airbus hires outside monitors amid fraud investigations

Airbus has appointed an independent panel including two former ministers to examine its anti-corruption practices after Britain and France launched fraud and bribery investigations into the sale of jetliners.

Europe's largest aerospace group said on Monday the three advisers, who include former German finance minister Theo Waigel and former French European affairs minister Noelle Lenoir, will report to Chief Executive Tom Enders and the board.

Airbus is in the midst of an upheaval after acknowledging discrepancies in past applications for British financial support to sell passenger jets.

The company's self-disclosure of "misstatements and omissions" regarding the use of middlemen to help win contracts prompted Britain's Serious Fraud Office to launch a bribery and fraud investigation last year. read more »

Ukrainian hacker gets prison in U.S. insider trading case

A Ukrainian computer hacker was sentenced on Monday to 2-1/2 years in prison over his role in a global scheme to conduct insider trading based on stolen, yet-to-be-published corporate news releases, U.S. prosecutors said.

Vadym Iermolovych, 29, of Kiev, had been the first hacker to admit criminal wrongdoing, in what authorities have called the largest known hacking scheme to game financial markets, leading to more than $100 million of illegal profit. read more »

PDV vulnerable to indictment: US officials

The US government is weighing federal indictments against current and past senior officials of Venezuela's state-owned PdV, and the oil company itself, for corruption, a top US official and a former senior US official tell Argus.

The US is the top destination for PdV's crude exports, with much of the supply absorbed by Citgo, PdV's US downstream subsidiary and remaining prize asset.

Current Venezuelan ambassador to the UN Rafael Ramirez, who served as energy minister in 2002-2014 and simultaneously as PdV chief executive in 2004-2014, is one of the senior Venezuelan nationals under scrutiny, the current and former US officials said.

US attorneys are also "seriously considering" whether to seek criminal indictments against PdV, as a corporation, under the Foreign Corrupt Practices Act and the Racketeer Influenced and Corrupt Organizations Act, they said separately. read more »