Former SEC Lawyer on Trial for Fraud

February 5th, 2010

The tables have turned for Phillip Offill Jr.

In January, Offill went to an Alexandria, Va. courthouse because he was charged with the exact same type of crime he spent 15 years prosecuting as a federal Securities and Exchange Commission litigator.

On January 28, Offill was convicted on 10 counts of conspiracy and wire and securities fraud by a jury, according to a release from the U.S. Justice Department. Offill was immediately jailed after the verdict and faces significant prison time after the conviction.

According to the Dallas Morning News, Offill could face as many as 185 years in prison and be ordered to pay back as much as $15 million in lost funds.

“It is a sad day when a former U.S. Securities and Exchange Commission attorney uses what he learned in the government to later defraud the investing public,” Assistant Attorney General Lanny A. Breuer of the Criminal Division said after the verdict was given.

In 2004, Offill and Phoenix-based attorney David Stocker were involved in a scam to drive up prices of certain securities through press releases and spam-style email blasts, only to then sell the interests once the value went falsely went up, according to UPI. This type of scam is commonly called a “pump and dump.”

Along with the spreading information through media, the two lawyers also avoided stock registration requirements in order to hide the true nature of the stocks’ value when they wanted to sell at a high price, UPI reported.

In the criminal indictment against both Offill and Stoker, the two were accused of collaborating to register millions of shares in nine small companies that the two lawyers sold to investors, the Morning News reported. Once the prices went up through their media blasts and the lack of true records about the companies’ real finances, Offill and Stocker sold all shares in the valueless companies before stocks collapsed.

Stocker pleaded guilty to charges in 2009.

Earlier in January, Offill attended a court hearing within the federal court in mid-January on a contempt of court charge. He took the stand and defended himself against charges that he helped a client violate a court-order freeze on assets. Ironically, the freeze was placed on the individual after the SEC charged him with securities fraud, which is exactly the type of crime Offill used to prosecute.

Offill argued during the hearing that the assets considered frozen belonged to other companies that were labeled in the original court order as being a part of the freeze. He is scheduled to be sentenced in April.

Conservative Filmmaker Admits to Role in Phone Caper at Senator Office

February 1st, 2010

One of four men charged with going into a U.S. senator’s office and tampering with the phones said in a statement he was trying to “investigate” whether the senator was avoiding calls from constituents about health care.

James O’Keefe, a right-leaning filmmaker, released his statement on Biggovernment.com while he and three other men await court proceedings for federal charges related to the incident. O’Keefe has been accused of shooting pictures and video of two men, dressed as phone repair men, entering Sen. Mary Landrieu’s Louisiana office to ask about problems with the phone system, according to a Washington Post report.

O’Keefe said in his statement that he learned Louisiana citizens looking to urge Sen. Landrieu from voting in favor of a national healthcare bill had trouble getting through on her office’s phones. O’Keefe said the senator responded to the claim by saying phones lines had been jammed for weeks.

“On reflection, I could have used a different approach to this investigation, particularly given the sensitivities that people understandably have about security in a federal building,” O’Keefe said in his statement. “The sole intent of our investigation was to determine whether or not Senator Landrieu was purposely trying to avoid constituents who were calling to register their views to her as their Senator.”

O’Keefe, who earned attention last year for filming hidden-camera interviews with the community-organizing group ACORN to expose alleged corruption, and three other men are charged with entering federal property under false pretenses with intent to commit a felony.

Penalties for conviction can include up to 10 years in prison and up to $250,000 in fines.

Joseph Basel and Robert Flanagan were described as entering Landrieu’s office disguised as telephone repair men, according to the Washington Post. Stan Dai is charged with assisting in the act, but to what extent hasn’t been reported.

Flanagan’s attorney J. Garrison Jordan was recently quoted in the New York Times describing the incident as a “prank.”

“Mr. O’Keefe has a history of trying to embarrass agencies or political entities on camera,” Attorney Jordan told the New York Times. “I think it was just an ill-designed stunt with no intent to commit a crime.”

O’Keefe also claims in his statement that the U.S. government is holding tape recordings made of the entire fiasco that will show allegations against him and the three other men among news reports are false.

The Associated Press and MSNBC reported incorrectly that he broke into the office and was under a gag order, while the Washington Post and other outlets mistakenly reported the act was an attempt to bug phones within Landrieu’s office.

New Orleans Hospital Trial Coud Set Disaster Precedent

January 23rd, 2010

A new lawsuit could set a sweeping legal precedent about how prepared hospitals have to be before a natural disaster strikes, and how effectively they must respond both during and after a catastrophe.

The civil trial began in the wrongful death lawsuit of Althea LaCoste against the Pendleton Memorial Methodist Hospital in New Orleans.

Several differing perspectives were offered on what led to the 73-year-old woman’s death while at the hospital when flood waters led to a power outage at then hospital after Hurricane Katrina struck New Orleans in late August 2005.

Depending on the outcome of this suit, hospitals could potentially be liable for maintaining high levels of operation during a wide range of emergencies, including viral pandemics, natural disasters and terrorist attacks.

Attorney Lawrence Best, who is representing LaCoste’s family members, said during opening arguments that he will focus on the hospital’s alleged failure to supply power to the hospital with an emergency backup that could stand up to a powerful storm. Best claimed during the Jan. 12 start date that the neglect of such a system is what caused her death, according to the Times Picayune.

David Bowling, serving as attorney for both Methodist and its parent owner Universal Health Services of Pennsylvania, asserted that hospital staff did everything that could be expected to save lives before and after floodwaters filled the city. Bowling added that ruling in favor of LaCoste’s relatives would set a standard too high for hospitals to actually meet, the Times Picayune reported.

LaCoste was taken to Methodist for congestive heart failure one day before the storm caused an immense amount of damage both in the New Orleans area and along the Gulf Coast. She was put on a mechanical respirator which went out when the hospital lost power after a fuel pump was flooded.

Nurses kept her alive throughout the 18 hour power outage with manual breathing assistance using hand pumps, but she passed away some time after power came back on.

“Some of them knew this (fuel pump) was on ground level,” Best said. “Some of them should have known. And all of them should have done something about it.”

While Bowling did not argue how detrimental the fuel pump’s low placement was on the hospital, he pointed out that LaCoste’s physical condition played a role in her passing. Bowling said LaCoste also suffered from persistent infections and diabetes along with heart failure, according to the Times Picayune.

The trial has continued with testimonies from former Methodist staff and administrators, as well as LaCoste’s family members. In 2002, former Methodist vice president Cameron Barr wrote that the hospital did not have a backup generator system that could withstand 15 feet of flood waters.

At the Jan. 15 court date for the trial, former Methodist CEO Larry Graham said he was not aware of Barr’s report.

Feds Throw in the Towel in the Legal Fight Against ‘Junior’ Gotti

January 19th, 2010

Teflon must run in the genes of some mob-connected families.

Federal prosecutors have decided not to bring John A. “Junior” Gotti to court for a fifth trial on organized crime-related related charges. Gotti Jr. has been tried four other times in federal court over the last five years on similar mob charges, and all four ended with hung juries.

His father, famed Gambino crime family figurehead John Gotti Sr., was nicknamed the ‘Teflon Don’ after he also evaded several convictions after going to court on federal charges. Prosecutors, however, broke through Gotti Sr.’s nonstick surface and sent him to a federal prison in Texas after he was convicted on racketeering charges, according to CNN.

Gotti Sr. died in that Texas prison in 2002.

The U.S Attorney office’s New York City branch filed a notice on January 8 of nolle prosequi or “non prosecution.” Shortly after filing, U.S. District Judge Kevin Castel effectively dismissed the case by signing the notice, CNN reported.

No clear reason was offered by the U.S. Attorney’s Office for ending their pursuit of 45-year-old Gotti Jr. in court, aside from a vague statement found in court papers filed by Assistant U.S. Attorney Elie Honig.

“In light of all the circumstances, the government has decided not to proceed with the prosecution against John A. [Junior] Gotti,” according to court papers.

These aren’t “Junior’s” first criminal charges. In 1999, he pleaded guilty to racketeering charges and spent the next five years in prison as part of a plea agreement, according to CNN. Since he was sentenced, Gotti has insisted that he has had no involvement with organized crime.

But authorities said otherwise. While still in prison, he was named in other federal cases and has been heavily monitored by authorities since his release.

In 2004, Junior faced a 42-page federal indictment that included fraud, extortion, loan sharking and kidnapping, according to a 2005 New York Times article. The kidnapping charge stems from the June 1992 attack on Guardian Angels leader Curtis Sliwa, where Sliwa was shot several times while in a taxi cab on the way to a radio broadcast.

Gotti Jr. allegedly ordered the attack on Sliwa after the activist described Gotti’s father as a “crook” and a “thug” on a radio show, the Times reported.

In 2008, a murder charge was added to the extensive indictment against Junior, according to CNN. But since 2004, four trials for the indictment all ended in mistrials because of deadlocked juries.

Attorney Ron Kuby, who represented Gotti Sr. for several trials, told CNN that the U.S. government can’t keep trying Gotti over and over.

“He has been a full time defendant for the last five years,” Kuby said. “If Gotti [Jr.] is going to go to prison, he’s going to have to commit a brand new crime.”

Mexican Drug Lord Makes Forbes Most Powerful List

December 14th, 2009

A Mexican drug lord – Joaquin “el Chapo” Guzman was recently named in Forbes magazine’s list of most powerful people in the world, according to a CNN article.

Born into a low income family, Guzman was a poorly educated child who was kicked out of his home at a young age - but now he has made it on two Forbes lists as one of the most powerful and wealthiest people in the world.

Guzman was ranked at number 41, beating Oprah Winfrey on the most-powerful list. Winfrey was ranked number 45. Many people consider Winfrey a very influential and powerful woman with her huge number of devoted fans across the nation.

But this is not the first time Guzman has made one of the magazine’s top lists. In March, he was placed as one of the wealthiest people with a net worth of over $1 billion. The Forbes article stated that Guzman was a self-made billionaire and only in his 50’s.

Authorities state Guzman controls the Sinaloa Cartel – a very powerful cartel in Sinaloa, Mexico.  Sinaloa has a big drug trafficking operation.

According to a TIME Magazine article, he began his career in the drug trade as an apprentice of “El Padrino” Miguel Angel Felix Gallardo, who was once in control over Mexico’s most powerful drug cartel.

Guzman then founded his own drug cartel in 1980, setting up control over 17 states in Mexico.

Authorities believe the drug lord shipped between $6 billion and $19 billion worth of cocaine to the U.S. over an eight year time span. Over the years there have been severe power struggles with government to control transports at the U.S. /Mexican border.

U.S. officials have offered rewards in the amount of $5 million for anyone with information about the whereabouts of Guzman in hopes to find him and arrest him.

Guzman was arrested once before in 1993 for homicide, drug charges, bribery and conspiracy. He escaped in 2001. He allegedly bribed guards at the Puente Grande prison in Jalisco, Mexico.

The guards allegedly smuggled him out via a laundry truck. Mexican officials arrested more than 70 prison officials for helping Guzman escape.

After Guzman escaped, he gained back control of the drug trafficking operations and is still at large today.

Guzman is currently under indictment in the state of Illinois for drug trafficking charges for smuggling cocaine into the state.

Students Allowed Back to School after “Tainting” Stew

November 4th, 2009

According to a CNN article, two white students have recently been allowed to return to a South African university in Johannesburg after they allegedly served two black housekeepers a stew filled with their urine back in 2007.

Roeluf Malherbe and Schalk Van der Merwe were banned from campus after a video emerged allegedly showing the young men - along with several accomplices - mixing beef stew and urinating in it.

What happens next violates every health and safety code - they serve the stew to the dorm housekeepers.

The school recently withdrew its complaints against the students and invited them back to resume their schooling. Jonathan Jansen - the vice chancellor at the university - is the first black man to hold the position at the University of the Free State in Bloemfontein.

The chancellor himself made the decision to allow the students to return.

However, Jansen states the university has no other control of the students’ fate outside the school. Both face criminal charges and human rights charges.

At this point it is undetermined if the students will return to school.

University officials stated the video was made in retaliation of the university’s attempt to integrate the schools. Almost 20 years after apartheid, the dorms are still divided into white and black dormitories.

After the incident occurred, both students released a statement apologizing “for any embarrassment [they] may have unintentionally caused.”

They further claimed that the video was altered to make it to appear as though they “tainted” the stew by urinating in it. They continued to say that the liquid they put into the stew was completely harmless and that they did not mean to hurt anyone, CNN reported.

South Africa’s Ministry of Higher Education does not agree with the decision to let the boys back in. They believe the boys should apologize and face any and all allegations.

From the university’s point of view, there appears to be no sense of remorse from the boys. They believe the boys just think it was a funny prank.

But what about the housekeepers - the victims in this alleged incident? They claim they are still being taunted by the students and have requested new uniforms because the old ones are a constant reminder.

The Ministry believes if the students return to school, it might look like the government is failing to address not only the situation at hand, but also the underlying issue of racism in the university.

Charges have not yet been pressed against the boys and the university is not yet commenting whether or not the boys will return to school.

Parents Face Criminal Charges for “Boy in the Balloon”

October 21st, 2009

Richard and Mayumi Heene – the parents of the young boy thought to be flying around Fort Collins, Colo. - are being accused of a hoax and face criminal charges, according to a CNN report.

They are being accused of allegedly fabricating the story that their son Falcon climbed into a homemade flying vehicle and went flying through the sky.

The parents, who were both previously featured on the show “Wife Swap,” have allegedly been looking for fame and celebrity status since the show aired in March 2009. Authorities state they created this incident as a publicity stunt to gain nationwide attention.

This apparent hoax led to a major search and rescue mission after images were aired on television of the young boy flying through the sky in the air balloon contraption.

The aircraft landed 60 miles from where it took off, and when it was found by the rescue teams, the young Falcon was nowhere to be found.

Authorities feared the worst - that the young boy had fallen out of the balloon. Hours later, Falcon emerged from a small space where he was hiding in the attic of his parents’ house.

Falcon’s older brother said he saw his younger brother get into the balloon and even videotaped it, but it appears he did get out of it.

According to a CNN article, the silver helium balloon is 20 feet long and five feet high was found 90 minutes away from the home in a field near Colorado Springs.

Richard Heene is a meteorologist and was building a “3D low altitude Vehicle.” It was not completely ready to fly and was not meant to fly above 20ft high.

Police only questioned the whole incident after the Heene family appeared on Larry King live and during the conversation, Falcon told his father, “ you guys said, um, we did this for the show. “

Authorities, upon hearing this, decided to interview the parents again and they then determined that the whole thing could a fabrication for the parents to gain attention.

The Heenes are facing felony charges of conspiracy to commit a crime, contributing to the delinquency of a minor and attempt to influence a public servant.

Richard Heene’s attorney, David Lane, has not yet seen any evidence from authorities and he hopes that the authorities will let the Heenes turn themselves in instead of creating a big spectacle and bringing them into the station with police escorts, CNN reported.

He maintains the Heenes are good parents to their three children and for them to see their parents in handcuffs could cause devastating effects.

The Larimer County Sheriff’s Department advised no comments will be given until the investigation is complete.

Who Posted Battered Rhianna Pics? LA Police Officers on Paid Leave

October 6th, 2009

Rhianna and Chris Brown - almost every American knows their story by now. Chris Brown allegedly beat his girlfriend - pop music star Rhianna - before the Grammy Awards last year.

He punched and choked the star leaving her badly injured. Then two weeks later, a photo appeared on celebrity gossip Web site TMZ.

Who leaked the information? According to the Los Angeles Times, two LA police officers are on paid leave until further investigation, but have not been convicted of any crimes at this point in time.

The two officers have been identified as Rebecca Reyes, who’s been with the LAPD for nine years, and Blanca Lopez, who worked for a different department - but the two women were roommates.

Reyes’ attorney confirmed a search warrant was delivered to her home in connection with the investigation, but he maintains her innocence and that she did nothing wrong.

He also stated that the department has not made any criminal charges or formal allegations against her.

The attorney did not say whether Reyes had taken the picture, or if she ever had it in her possession. The LAPD is continuing an investigation but will not supply any details about the case to the public.

The police department now has strict rules about taking pictures and recording video images at crime scenes.

They tightened up their rules and regulations due to quite a few leaks of celebrities this past year. Pictures of celebrity arrests were posted on celebrity gossip sites.

A new state law was passed in California making it illegal for police officers to profit by leaking confidential reports or images, the LA Times reported.

Rhianna’s attorney said he’s happy with the LAPD and their investigation of the case and believes that no victim should have to suffer the embarrassment of photographs of such an incident.

A price to pay for fame - celebrities forced to relive difficult moments of their past and present. They count on the police at least to keep their matters private, and if the police don’t always do so, then who will?

Former Manson Follower Dies in Prison

September 29th, 2009

Susan Atkins, the infamous Charles Manson follower, recently died in prison from brain cancer, CNN reported.

As many may remember, she was responsible for the murders of actress Sharon Tate; Abigail Folger, whose family owned the famous coffee company by the same name; and celeb hairstylist Jay Sebring, among others. She was convicted of seven murders in the summer of 1969.

All were found dead at Tate’s home in Bel Air, Calif., which she shared with her husband – film director Roman Polanski. He was not home at the time of the murders.

Perhaps the most disturbing part of this crime is that Tate was eight and a half months pregnant when she was brutally stabbed by Atkins.

Atkins admitted to the crime stating she stabbed Tate several times – killing her and her unborn son as Tate begged for both their lives.

Atkins claimed she committed these crimes with fellow cult members because they were ordered to do so by their leader Charles Manson. Her confession also stated that she and the other members were under the influence of LSD at the time of the murders – a drug known to cause hallucinations.

Atkins was sentenced to death, but her sentence changed to life imprisonment when the U.S. Supreme Court overturned the nation’s death penalty in 1972. They later reinstated it in 1976, but her sentence did not change back.

Since then Atkins has requested parole 13 times and has been denied every time. Her last attempt for parole – “a compassionate plea” – was denied even after she had surgery for her cancer related issues.

According to CNN, Tim O’Hara, the Parole Commissioner, said Atkins’ request for parole was denied because the board believes she still does not fully understand the magnitude of her crimes. The parole board also claimed the crime was so horrible that they denied the claim due to its “atrocious nature.”

Atkins served most of her time, 37 years, in the California Institution for Women.

She was later transferred to a community hospital in 2008 due to her health, and was finally transferred to Chowchilla Prison’s Nursing Center a year before she died.

Atkins was said to be a born again Christian, and many of those who knew her thought of her as a model prisoner – but the victims’ families never heard any regret or apology for her awful crimes all those years ago.

Hofstra Students Accused of Rape – Until the Accuser Revealed the Truth

September 25th, 2009

The young female student Danmell Ndonye, a young female student at Hofstra University had accused five young men of gang raping her on the New York campus, but later recanted her story, the New York Daily News reported.

She may now be charged for false accusations and suffer consequences from making up a story that could have ruined the future of the accused young men.

Ndonye told the Nassau County Police her cell phone was taken at a campus party while she was dancing and was lured back to the dorm where 5 young men proceeded to tie her up. They each then took turns engaging in un-consensual sexual activity. She stated this occurred around 3am in the university dorm bathroom.

The police were led to believe that this was a preplanned attack by the boys, setting up the young girl for the crime. They at this point had no reason to believe Ndonye was lying to protect herself from embarrassment of the incident.

The accused men were each charged with five counts of first degree rape and were facing up to 25 years in prison if they were convicted, according to the New York Daily News. They could have lost the chance to live their lives.
After claiming she was raped, Ndonye later changed her story stating that the sex was consensual and that the young men never raped her.

Ndonye took back her story after she learned of a video on a cell phone while she was being questioned by the state prosecutor. It allegedly shows that the sex had been consensual. None of the prosecutors knew during the questioning what exactly was on the video, but the girl ended up changing her story and said the sex was indeed consensual, according to the New York Daily News.

She allegedly told police she had been raped because she was afraid to tell her boyfriend about the incident; quite a big price to pay to keep a relationship together.

The charges against the young men were dropped, but it now appears Ndonye might face criminal charges as well as disciplinary actions from the university for making these false accusations.

Rondell Bedward – one of the male Hofstra students involved – had been suspended after Ndonye’s accusations, but his  suspension from the university was lifted after the truth was revealed.

A spokeswoman for the university stated that Ndonye has been suspended until after the school disciplinary hearing scheduled to decide what consequences she will face.

No criminal charges have been pressed nor any civil lawsuits filed at this point, but that does not necessarily mean she will not face any in the future.