At “Hockey bid a factor in Beckman’s Ponzi trial”, the StarTribune analyzes the Second Superseding Indictment filed in the criminal prosecution against Jason Bo Beckman, Gerald Durand and Patrick Kiley.  This StarTribune article explains the three are accused of money laundering and other alleged crimes arising out of Trevor Cook’s securities fraud which was one of the biggest Ponzi schemes in Minnesota history.  The article too reveals that the Second Superseding Indictment differs from two earlier ones.

This was true because the Second Superseding Indictment appears to accuse Mr. Beckman of using Ponzi scheme proceeds as part of an alleged attempt to buy an ownership interest in the National Hockey League’s Minnesota Wild team.  There is however, another difference between the Second Superseding Indictment and the previous indictments in this matter.  Unlike the earlier indictments, Counts 24-25 at pp. 34-36 of the Second Superseding Indictment, basically accuse Mr. Durand of using a nominee’s bank account at Wells Fargo to secretly convert nearly $22,000 in Swiss francs to U.S. dollars.

This supposed currency conversion had conceivably caused Wells Fargo to unknowingly file Currency Transaction Reports with material omissions in them, about who participated in said conversion.  Although suspected crimes related to Currency Transaction Reports are typically charged under 31 U.S.C. §§ 5322 &/or 5324, Counts 24-25 of the Second Superseding Indictment allege that Mr. Durand concealed material facts and / or made false statements to the Federal Government in violation of 28 U.S.C. §1001.Continue Reading Prosecutors Add To Indictment Connected To Ponzi Scheme Case

A February 3rd civil complaint filed against Forex dealer Peregrine Financial Group, (“PFG”), alleges “PFG ignored or failed to discern a myriad of objective red flags of fraud…” Complaint at pp. 5-6 ¶12.  The complaint asserted a $48 million dollar claim under Minnesota’s fraudulent conveyance law and it was filed by Receiver

A Primer For Gathering Financial Intelligence pronounces “Human intelligence can be the only practical way to uncover some sophisticated asset concealment schemes.”   The SEC Whistleblower Program sniffs out human intelligence by offering rewards for tips regarding securities fraudsters.  A November 2011 report shows the Whistleblower Program generated 334 tips during the seven week period from August 12, 2011 to September 30, 2011.

Jordan A. Thomas, (once an assistant director and senior attorney at the SEC), had a leadership role in developing this program.  Mr. Thomas drafted the proposed whistleblower legislation and briefed House and Senate staffs on it.  He is a partner at Labaton Sucharow LLP and chairs its Whistleblower Representation Practice.

His guest post featured below, notes that financial incentives and retaliation protections will cause the whistleblowers to come forward.  It also recognizes “the locating of hidden assets will play a major role in these whistleblower actions.”


The SEC Whistleblower Program: A Revolution in Law Enforcement?

Jordan A. Thomas

While the Securities and Exchange Commission (SEC) has just released its 2011 annual report touting a record number of enforcement actions, the $2.8 billion in monetary sanctions recovered seems a drop in the bucket against what the serial schemers have stolen.  But the game is changing, and the recovery of concealed assets will play a role in this revolution.

Under the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, the SEC established a new and, in many ways, revolutionary whistleblower program, which was finalized and implemented in August.  With the specter of major financial awards and protection from workplace retaliation, individuals now have powerful incentives to speak out against misconduct and report possible violations of the US securities laws. The eligibility requirements are broad and relatively straightforward.Continue Reading Human Intelligence & The SEC’s Whistleblower Program

Recognizing Hidden Assets, The Red Flags” explained that bankruptcy trustees, tax authorities, financial intelligence units, etc. search for concealed assets by looking for red flags of fraud or other illicit acts.  Lawsuits brought by investors damaged by Ponzi schemes also may focus on red flags, as described at “Florida Court Unlikely