Where Are They Now: Key Players In The Madoff Case
Jack Queen, 14 April 2021
Law360 (April 14, 2021, 9:05 PM EDT) — Ponzi king Bernie Madoff’s jailhouse death was all but guaranteed the moment he was sentenced. Before a packed federal courtroom in Manhattan — after the lawyers, victims and Madoff himself had spoken — Judge Denny Chin decided what punishment fit the financial crime of the century: 150 years, the maximum sentence available.
The decision prompted an outburst of cheers from the dozens of victims present. But it was the only joyful moment of a proceeding marked by anguished testimonials from victims, calls for justice from prosecutors, and pleas for mercy by Madoff’s defense team, which had asked for 12 years. Continue reading “Article: Where Are They Now: Key Players In The Madoff Case”
Wall Street Is Donating to This D.A. Candidate. Is That a Problem?
Jonah E. Bromwich, 13 April 2021
Even had she not raised more money than her rivals, Tali Farhadian Weinstein would be a formidable candidate in the nine-way race to become the Manhattan district attorney, perhaps the most high-profile local prosecutor’s office in the country.
She was a Rhodes scholar, has an elite legal résumé and is the only candidate who has worked for both the Justice Department and a city prosecutor’s office. And while most of the candidates are campaigning as reformers intent on reducing incarceration, Ms. Farhadian Weinstein, 45, has staked out a slightly more conservative position, expressing concerns about guns and gangs. Continue reading “Article: Wall Street Is Donating to This D.A. Candidate. Is That a Problem?”
One of World’s Greatest Hidden Fortunes Is Wiped Out in Days
Katherine Burton and Tom Maloney, 30 March 2021
From his perch high above Midtown Manhattan, just across from Carnegie Hall, Bill Hwang was quietly building one of the world’s greatest fortunes.
Even on Wall Street, few ever noticed him — until suddenly, everyone did.
Hwang and his private investment firm, Archegos Capital Management, are now at the center of one of the biggest margin calls of all time — a multibillion-dollar fiasco involving secretive market bets that were dangerously leveraged and unwound in a blink. Continue reading “Article: One of World’s Greatest Hidden Fortunes Is Wiped Out in Days”
Software Pioneer John McAfee Indicted In Crypto Case
Reenat Sinay, 05 March 2021
Antivirus software innovator John McAfee and his bodyguard have been indicted on fraud and money laundering conspiracy charges for fraudulently touting various cryptocurrencies on Twitter to further two separate schemes, Manhattan federal prosecutors said Friday.
Between December 2017 and October 2018, McAfee and private security guard Jimmy Gale Watson Jr. tricked investors into buying over a dozen different digital currencies in a pair of scams that allegedly netted the two men a combined $13 million in profits, according to a seven-count indictment unsealed Friday. Watson was also “executive advisor” of McAfee’s so-called cryptocurrency team, prosecutors said. Continue reading “Article: Software Pioneer John McAfee Indicted In Crypto Case”
Manhattan District Court Writes Final Chapter in Litigation Between Internet Law Library and Hedge Fund Adviser Southridge Capital Management; Orders Tech Firm to Pay Adviser Almost $1.2 Million in Attorney’s Fees on Top of Damages
Alisa Greenstein, Hedge Fund Law Report, 27 August 2010
On August 9, 2010, the United States District Court for the Southern District of New York (Southern District) effectively ended the decade-long litigation between Internet Law Library, Inc. (INL), its executives and several of its shareholders, and Southridge Capital Management, LLC (Southridge), its principals and affiliates, including hedge fund Cootes Drive, LLC, and its broker, Thomson Kernaghan & Co., Ltd. (TK & Co.). The litigation arose out of a “floorless” or “toxic” convertible securities purchase agreement between INL and Cootes Drive.
The agreement allowed Cootes Drive to demand conversion of its INL preferred stock into common stock based on a floating conversion ratio tied to the common stock’s market price, and obligated Cootes Drive to float a $25 million line of equity, so long as INL common stock remained priced above a certain level. This arrangement arguably provided Cootes Drive and its affiliates with an incentive to aggressively short-sell INL common stock, because the further they decreased its price, the more common stock Cootes Drive could obtain on conversion (which it could use to cover its short positions and profit from the difference), and because that decrease would eliminate its obligation to provide a line of equity. The agreement proved disastrous for INL, just as it has for many other companies with similar financing arrangements. Continue reading “Article: Manhattan District Court Writes Final Chapter in Litigation Between Internet Law Library and Hedge Fund Adviser Southridge Capital Management; Orders Tech Firm to Pay Adviser Almost $1.2 Million in Attorney’s Fees on Top of Damages”
SEC And Manhattan DA Investigate Southridge Capital
Nathan Vardi, 07 October 2009
Southridge Capital Management, a Ridgefield, Conn., hedge fund firm run by Stephen Hicks that primarily employs an investment strategy known as PIPEs, is under investigation by the Securities and Exchange Commission and Manhattan District Attorney Robert Morgenthau.
The SEC has opened an investigation into Southridge, according to two subpoenas the SEC sent in late July to companies that had received financing from the firm’s hedge funds.
In the five-page subpoenas, Vyta Corp. and Hyperdynamics Corp., two micro-cap companies that have been fighting Southridge for years in court, were asked by the SEC to produce documents reflecting all transfers of cash between them and the Southridge hedge funds over a four-year period. The companies were also told to provide documents relating to securities they issued to Southridge and communications between the companies and Southridge. Continue reading “Article: SEC And Manhattan DA Investigate Southridge Capital”