FraudBaron.com

Enron's Skilling Goes to Supreme Court?

reuters.com | 3/1/10 | suspect: Jeffrey Skilling

Lawyers for federal prisoner 29296-179 will take their last shot at shredding a lower court's conviction that sentenced him to 24 years in jail. If Skilling succeeds, his sentence could be shortened or he could win a new trial.

Bakersfield CPA Guilty in Mortgage Fraud Scheme

sacramento.fbi.gov | 1/13/10

KEVIN PATRICK SLUGA, 60, and his wife, LESLIE SLUGA, 57, of Bakersfield, pleaded guilty to four counts of wire fraud and two counts of wire fraud, respectively, for falsifying financial information used to obtain mortgages from financial institutions.

Ex-Homestore Chief Wolff Agrees to Plead Guilty in Fraud Case

bloomberg.com | 1/11/10 | suspect:  Stuart Wolff

Former Homestore Inc. Chief Executive Officer Stuart Wolff, whose conviction at trial was overturned on appeal two years ago, agreed to plead guilty to conspiracy to commit securities fraud, federal prosecutors said.

Credit Suisse Named In Real Estate Loan Lawsuit

spokesman.com | 1/5/10 | suspect:  Credit Suisse

A group of property owners from four luxury resorts - including Tamarack Resort in Idaho - has filed a $24 billion class-action lawsuit against Credit Suisse, alleging that the big Swiss bank engaged in a “predatory” lending scheme designed to force all four resorts into foreclosure and acquire the pricey properties for pennies on the dollar, while raking in “enormous” fees.

Homebuilder Guilty of Bank Fraud

bizjournals.com | 12/28/09 | $14 million | suspect:  Edward Levinson

Edward Levinson, president of Levinson Homes, pleaded guilty to a bank fraud charge in connection with his construction business that prosecutors said resulted in more than $14 million in losses to banks, prospective homeowners and subcontractors, Acting U.S. Attorney Michael Reap said Wednesday.

E&Y to Pay Fine for Bally Premature Revenue Recognition

reuters.com | 12/21/09  | $8.5 million | suspect:  Ernst & Young

Ernst & Young has agreed to pay $8.5 million to settle civil charges that it violated accounting rules in connection with a fraud at Bally Total Fitness Holding Corp, the U.S. Securities and Exchange Commission said.

Revenue Recognition Fraud Declines

webcpa.com | 12/16/09 |

Revenue recognition fraud seems to be on the wane, according to a report by the Deloitte Forensic Center.

Canopy Financial Accused of Creating False Financial Statements

bizjournals.com | 11/27/09 | suspect:  Canopy Financial

San Francisco-based Canopy Financial is accused of serious financial fraud, TechCrunch reported.  The company, which makes software to facilitate health-care savings accounts for insurers and financial institutions, is described by TechCrunch as making up its financial statements and even forging audited statements on fake KPMGletterhead.

Accountant Embezzles from Bell Fuse 401k Plan

newark.fbi.gov | 11/23/09 |$1 million|  suspect:  Daniel Chu

A senior accountant employed by Bel Fuse, Inc. pleaded guilty to embezzling approximately $1 million in cash and stock from the company.

Ex. Finance Director Accused in Asset Based Loan Fraud

albany.fbi.gov | 11/9/09 | suspect:  Paul Mammorella

Paul Mammorella, 54,  pleaded not guilty today in United States District Court in Burlington to a charge of bank fraud for preparing fraudulent financial statements in an asset based loan fraud scheme.

Mammorella was the former director of finance for Speciality Filaments, Inc., a now-defunct company which at one time manufactured nylon and polyester filaments used as components in industrial and commercial brushes.

According to the indictment, Specialty Filaments, which at one time had plants in Burlington and East Middlebury, had a multi-million dollar line of credit with Wells Fargo & Company that was secured by SFI’s inventory and accounts receivables. Under the terms of the loan agreement, SFI could borrow up to a certain percentage of the value of its qualifying inventory and accounts receivables.

Mammorella, as finance director, had to prepare and submit to Wells Fargo periodic reports certifying the value of the collateral securing SFI’s loan. Beginning in approximately June 2006, according to the indictment, and continuing through December 2006, Mammorella caused SFI to send Wells Fargo financial reports which falsely inflated the value of the company’s accounts receivables and inventory.

This enabled SFI to draw significantly more money from the line-of-credit that it actually was entitled to receive. In early January 2007, SFI went out of business and Wells Fargo discovered that the real value of SFI’s collateral was substantially less than the outstanding loan balance. As a result, Wells Fargo and the Vermont Economic Development Authority, which guaranteed a portion of the loan, lost more than $1 million.