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Three former financial services executives have been indicted for allegedly participating in fraud schemes and conspiracies related to bidding for contracts for the investment of municipal bond proceeds and other municipal finance contracts. The 12 count indictment charges Dominick P. Carollo, Steven E. Goldberg, and Peter S.

The senior managers of GDC Acquisitions, LLC, have been charged with bank fraud conspiracy arising out of their alleged scheme to use false financial statements to obtain $21 million in loans from Amalgamated Bank. The defendants are Courtney Dupree, GDC’s president; Rodney Watts, chief investment officer; Thomas Foley, chief operating officer; and Frank Patello, former chief financial officer.

New York has filed two new major securities fraud lawsuits – but they didn’t come from Attorney General Andrew Cuomo’s office. Instead, the state Comptroller, Thomas P. DiNapoli, as trustee of the $132.6 billion New York State Common Retirement Fund, brought the suits against Merrill Lynch and Bank of America, claiming they violated federal securities laws.

Joseph C. Donohue, a cattleman from Kansas, has been sentenced to six months in federal prison followed by six months of house arrest for bank fraud. He also was ordered to pay $10 million in restitution. 

Glen and Karen Kaiser, who provided information and documents leading to the imposition and collection of civil penalties in Securities and Exchange Commission v. Pequot Capital Management, Inc., et al., Civil Action No. 3:10-CV-00831-CVD (D.Ct. D. Conn., Complaint filed May 27, 2010), have been awarded $1 million by the SEC. This is the largest award paid by the SEC for information provided in connection with an insider trading case. 

Citigroup has agreed to pay $75 million to settle SEC charges that it misled investors about its exposure to subprime mortgage-related assets. Former chief financial officer Gary Crittenden agreed to pay $100,000, and former head of investor relations Arthur Tildesley, Jr., (currently the head of cross marketing at Citigroup) agreed to pay $80,000, to settle charges against them. 

A Virginia man pleaded guilty today to one count of mail fraud for his participation in a scheme to defraud the U.S. Department of Defense. Jonathan Feeney waived his right to an indictment and pleaded guilty to a one count criminal information that charges him with using the U.S. mails to execute a scheme involving fraudulent invoices to defraud the U. S. Department of Defense.  

There are some disturbing allegations in an indictment charging Wayne Taft Harris, Jr., formerly of Indianapolis, with wire fraud. The indictment alleges that Harris contacted Third World Missions, a Christian faith-based organization located in Florida that operates bible schools and orphanages in various locations throughout the world, to obtain a loan with which to construct a church facility in Indianapolis.

A botnet is a network of remote-controlled compromised computers. According to the FBI, the Mariposa Botnet was built with a computer virus known as “Butterfly Bot” and was used to steal passwords for websites and financial institutions. It stole computer users’ credit card and bank account information, launched denial of service attacks, and spread viruses.