A jury has cleared Tesla CEO <a href="https://www.dailywire.com/topic/elon-musk" target="_blank" rel="noopener">Elon Musk</a> of claims made by investors that he defrauded them several years ago when he tweeted that he was considering taking the company private.
&#8220;Am considering taking Tesla private at $420,&#8221; Musk tweeted on August 7, 2018. &#8220;Funding secured.&#8221;
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">
Am considering taking Tesla private at $420. Funding secured.
&mdash; Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1026872652290379776?ref_src=twsrc%5Etfw">August 7, 2018</a></blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
A federal jury in San Francisco rejected demands that the 51-year-old billionaire should have to pay billions of dollars in damages over the tweet.
Musk was present during the trial and took to the witness stand where he said that he had come to a handshake agreement at the time with Saudi Arabia&#8217;s Public Investment Fund to take the company private. He said that the Saudis later backed out of the deal.
“I had no ill motive,” Musk said. “My intent was to do the right thing for all shareholders.”
Adam Pritchard, a professor at University of Michigan Law School, said that the case is not likely to become precedent that changes how other executives exercise free speech online.
“Nobody does this — only Elon does this,” Pritchard said while complaining about Musk&#8217;s online speech. “He’s incorrigible. I don’t think his behavior can be reformed. There’s just too long of a track record of too much mischief.”
Following the verdict, Musk tweeted his appreciation for the jury: “Thank goodness, the wisdom of the people has prevailed! I am deeply appreciative of the jury’s unanimous finding of innocence in the Tesla 420 take-private case.”
<blockquote class="twitter-tweet">
Thank goodness, the wisdom of the people has prevailed!
I am deeply appreciative of the jury’s unanimous finding of innocence in the Tesla 420 take-private case.
— Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1621653950947799042?ref_src=twsrc%5Etfw">February 3, 2023</a></blockquote>
Musk has taken a public company private before. When the billionaire purchased Twitter in late 2022, he took the company private, removing it from the stock exchange. Erik Gordon, Professor of Business at the University of Michigan, noted in a piece for <a href="https://www.yahoo.com/video/elon-musk-poised-twitter-private-122835418.html?guccounter=1&amp;guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&amp;guce_referrer_sig=AQAAAAM7DL7I4OVyHTZIuXjRIcUxnyPqptmVwCcxO4gsC9rBZ6iRemIrLH_pY8DkpwFumRsXV6mjonbvllL2jVhuuoIWjjxyeDkecCE9kLPLvYZKF70TvV_yPCjbX4Uj4t1PDevtf_wH__bbVpDaudLHIk2BJ7IQkabOcbbVWnECyfxI" target="_blank" rel="noopener">The Conversation</a> that public companies don’t frequently go private, but it does happen.
Some benefits of going private — from the standpoint of someone like Musk — might be that Twitter would no longer have to file reports with the Securities and Exchange Commission (SEC), and would have “few shareholders — sometimes just one,” among other pluses.

Shareholder Trial Against Tesla And Elon Musk

Jury Announces Verdict In Elon Musk Fraud Case

Courts

Elon Musk

Fraud

Tesla

U.S.

Adani Enterprises, the flagship publicly traded company operated by Adani Group and one of the largest companies in India, will be removed from the Dow Jones Sustainability Indices next week following claims that the multinational conglomerate benefited from <a href="http://dailywire.com/topic/fraud" target="_blank" rel="noopener">money laundering</a>.
The valuation of the firm run by Gautam Adani, who is one of the <a href="https://www.forbes.com/real-time-billionaires/#279614163d78" target="_blank" rel="noopener">richest</a> men in the world, was artificially inflated by “a brazen stock manipulation and accounting fraud scheme over the course of decades,” according to a two-year <a href="https://www.dailywire.com/news/indian-company-loses-100-billion-after-american-researchers-say-they-run-the-largest-con-in-corporate-history" target="_blank" rel="noopener">investigation</a> from American forensic financial company Hindenburg Research released last week. Analysts uncovered shell companies and diamond trading scams operated by family members to inflate the stock price of the firm.
Adani Enterprises, which has lost more than $100 billion on the stock market, will therefore be <a href="https://www.spglobal.com/spdji/en/documents/indexnews/announcements/20230202-1461140/1461140_djsi-adani-20230202.pdf" target="_blank" rel="noopener">removed</a> from the Dow Jones Sustainability Indices over the “allegations of stock manipulation and accounting fraud.” The company is <a href="https://portal.csa.spglobal.com/survey/documents/DJSIComponentsEmergingMarkets_2022.pdf" target="_blank" rel="noopener">listed</a> on the Sustainability Emerging Markets Index, which also includes companies from China as well as other developing economies.
The investment products are <a href="https://www.spglobal.com/esg/performance/indices/djsi-index-family#:~:text=The%20Dow%20Jones%20Sustainability%20Indices,convictions%20in%20their%20investment%20portfolios." target="_blank" rel="noopener">advertised</a> as “best-in-class benchmarks for investors who have recognized that sustainable business practices are critical to generating long-term shareholder value and who wish to reflect their sustainability convictions in their investment portfolios.” Adani Enterprises likewise <a href="https://ungc-production.s3.us-west-2.amazonaws.com/commitment_letters/102361/original/APL_UNGC_Letter.pdf?1481805018" target="_blank" rel="noopener">told</a> the United Nations that the company supports the Global Compact, a voluntary <a href="https://www.unglobalcompact.org/about" target="_blank" rel="noopener">initiative</a> based on commitments to implement “universal sustainability principles” such as human rights, labor, environment, and anti-corruption measures. The firm published a lengthy sustainability <a href="https://www.adanienterprises.com/-/media/Project/Enterprises/Sustainability/document/AEL%20Sustainability%20Report%202022.pdf" target="_blank" rel="noopener">report</a> reflecting adherence to the environmental, social, and corporate governance movement, also known as ESG.
Adani Group is involved in sectors such as port management, electric power, mining, oil and gas, renewable energy, and food processing. Shares for Adani Enterprises have declined from 3,442 rupees ($40.58) on the day Hindenburg Research published the results of the investigation to 1,531 rupees ($18.59) on Friday. Hindenburg Research said they took a short position in the company through American-traded bonds and various derivatives. Adani plummeted from the third richest person on the planet to the 17th following the release of the report last week.
Adani Group published a <a href="https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rPxvSL..aP0g/v0" target="_blank" rel="noopener">document</a> calling Hindenburg Research executives the “Madoffs of Manhattan” and said their investigation was based upon “selective misinformation and concealed facts.” The company also accused Hindenburg Research of launching an “attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India,” leading the investors to <a href="https://hindenburgresearch.com/adani-response/" target="_blank" rel="noopener">rebut</a> that the document “largely confirmed our findings and ignored our key questions.”
Adani Group follows several other fraudulent firms which have <a href="https://www.dailywire.com/news/how-sam-bankman-fried-weaponized-wokeness-to-dupe-progressive-investors" target="_blank" rel="noopener">taken advantage</a> of investors’ appetites for socially conscious companies.
Elizabeth Holmes, the founder of defunct healthcare venture Theranos, garnered widespread recognition as one of the most successful female entrepreneurs in Silicon Valley history before she was <a href="https://www.dailywire.com/news/breaking-elizabeth-holmes-disgraced-media-darling-behind-theranos-fraud-sentenced-to-11-years-in-prison" target="_blank" rel="noopener">sentenced</a> to federal prison on fraud charges. Sam Bankman-Fried, the founder of bankrupt cryptocurrency exchange FTX who lost billions in customer assets by commingling the funds with his trading firm, admitted to a reporter that ESG has been “perverted beyond recognition” and <a href="https://www.dailywire.com/news/how-sam-bankman-fried-weaponized-wokeness-to-dupe-progressive-investors" target="_blank" rel="noopener">boasted</a> that he generated trust among “woke westerners” through emphasizing his self-professed “effective altruism.”
Pfizer was <a href="https://www.dailywire.com/news/pfizer-bragged-about-being-named-one-of-worlds-most-sustainable-companies-days-before-project-veritas-sting" target="_blank" rel="noopener">named</a> one of the “most sustainable companies” in the world days before Project Veritas released footage of an official appearing to admit that the pharmaceutical firm was considering mutating coronaviruses. Elon Musk recently <a href="https://www.dailywire.com/news/elon-musk-the-s-in-esg-stands-for-satanic" target="_blank" rel="noopener">said</a> on social media that “the S in ESG stands for Satanic” and has formerly called the investment philosophy a “scam” that has been “weaponized by phony social justice warriors.”

Billionaire Gautam Adani Visits Port of Haifa

Allegedly Fraudulent Indian Company That Lost $100 Billion Was Heavily Involved In ESG Movement

Business

Money

Stock Market

<a href="http://dailywire.com/topic/india" target="_blank" rel="noopener">Indian</a> multinational conglomerate Adani Group lost some $100 billion in <a href="http://dailywire.com/topic/stock-market" target="_blank" rel="noopener">stock market</a> value after a team of researchers claimed that the firm pulled “the largest con in corporate history.”
The valuation of the firm run by Gautam Adani, who is currently one of the <a href="https://www.forbes.com/real-time-billionaires/#279614163d78" target="_blank" rel="noopener">richest</a> men in the world, was artificially inflated by “a brazen stock manipulation and accounting fraud scheme over the course of decades,” according to a two-year <a href="https://hindenburgresearch.com/adani-response/" target="_blank" rel="noopener">investigation</a> from American forensic financial company Hindenburg Research. The analysts spoke to former executives and conducted diligence visits in multiple nations, concluding that Adani Group companies have pledged shares of their stock for loans, assumed massive amounts of debt, and benefited from shell companies established by various family members.
Vinod Adani, the elder brother of Gautam Adani, allegedly controls 38 shell companies located in the island nation of Mauritius, as well as Cyprus, Singapore, the United Arab Emirates, and several Caribbean islands. The firms have negligible online presences and many appear to hire zero employees; the researchers found that efforts to mask the true nature of the companies were “rudimentary,” citing the fact that 13 of the companies’ websites were created on the same day and contain little more than stock photos.
Adani Group is involved in sectors such as port management, electric power, mining, oil and gas, renewable energy, and food processing. Gautam Adani plummeted from the third richest person on the planet to seventeenth following the release of the report last week.
The shell companies exist for stock parking, stock manipulation, and laundering money through Adani’s private companies “onto the listed companies’ balance sheets in order to maintain the appearance of financial health and solvency,” according to Hindenburg Research, which said that the offshore companies comprise many of the largest public holders of Adani Group stock. The report added that Rajesh Adani and Samir Vora, the younger brother and brother-in-law of Gautam Adani, were appointed to executive positions in the empire despite their involvement in alleged offshore diamond trading scams. Indian authorities have launched a number of investigations into the family over the past two decades.
Shares for Adani Enterprises, the flagship publicly traded company operated by Adani Group, have declined more than 52% over the past five days. Hindenburg Research said they took a short position in the company through American-traded bonds and various derivatives.
Adani Group published a <a href="https://assets.bwbx.io/documents/users/iqjWHBFdfxIU/rPxvSL..aP0g/v0" target="_blank" rel="noopener">document</a> calling Hindenburg Research executives the “Madoffs of Manhattan” and said that their investigation was “a malicious combination of selective misinformation and concealed facts relating to baseless and discredited allegations to drive an ulterior motive.” The company also accused Hindenburg Research of launching an “attack on India, the independence, integrity and quality of Indian institutions, and the growth story and ambition of India,” leading the investors to <a href="https://hindenburgresearch.com/adani-response/" target="_blank" rel="noopener">rebut</a> that the document “largely confirmed our findings and ignored our key questions.”
The economy of India has indeed <a href="https://www.dailywire.com/news/india-will-surpass-japan-and-germany-as-the-worlds-third-largest-economy" target="_blank" rel="noopener">grown</a> significantly in recent decades despite corruption and a lack of sound institutions. The nation is scheduled to become the world’s third-largest economy in the next decade and most populated nation this year, surpassing longtime geopolitical rival China for the latter distinction.

Indian Company Loses $100 Billion After American Researchers Say They Run ‘The Largest Con In Corporate History’

Indian Company Loses $100 Billion After American Researchers Uncover Alleged Fraud

Crime

India

World

Not only did the glut of coronavirus-tied bailouts likely result in billions of dollars of fraud, but it happened because government agencies in many cases did not take even basic steps to prevent it, and in other cases have declined to try to claw back improper payments, the Government Accountability Office said Wednesday.
In a searing, comprehensive <a href="https://www.gao.gov/products/gao-23-106556" target="_blank" rel="noopener">report</a>, the nonpartisan auditing arm of Congress excoriated the administration of almost every pandemic-era spending program—and Congress itself—for doling out $4.6 trillion with the prospect of fraud seemingly an afterthought.
Three years after the pandemic began, rampant fraud turned out to be very much a reality.
Unemployment fraud. Coronavirus-era programs flooded cash into a program that already has one of the government&#8217;s highest rates of improper payments: unemployment checks. Non-coronavirus <a href="https://www.dailywire.com/news/thousands-of-pandemic-unemployment-claims-listed-the-names-of-still-employed-government-workers-senator-says" target="_blank" rel="noopener">unemployment checks</a> already had an improper payment rate of nearly 19% in fiscal year 2021 and more than 22% in 2022. Coronavirus programs flooded this with even easier access to even more cash, with $873 billion in checks to people who said they were laid off or had hours reduced because of coronavirus. In the best-case scenario&#8211;that coronavirus unemployment checks were no more fraudulent than the lower 2021 non-coronavirus value&#8211;&#8220;at least $163 billion in pandemic UI benefits could have been paid improperly,&#8221; the GAO said.
And that’s likely a vastly optimistic scenario, because the coronavirus unemployment program “allowed applicants to self-certify their eligibility and did not require them to provide any documentation of self-employment or prior income.” The Department of Labor, which administers the program, also encouraged states to waive a standard 21-day waiting period—the period in which anti-fraud scrutiny often occurs.
Even as it dramatically loosened controls on a program that already had an atrocious rate of improper payments, the Department of Labor did not have a dedicated fraud unit in place, and more than two years after the GAO first warned of the problem in October 2021, DOL said it was merely “in the process” of “proceeding with implementing” the recommendations—long after the pandemic has ended, according to the GAO.
PPP loans. The most prominent coronavirus bailouts—forgivable PPP and EIDL loans for businesses—were administered by the Small Business Administration, which did not even set up an anti-fraud entity until after the program was done giving out money, GAO said.
“SBA did not designate a dedicated antifraud entity until February 2022. This new entity—the Fraud Risk Management Board—is to oversee and coordinate SBA’s fraud risk prevention, detection, and response activities. Further, in March 2021, we found that SBA had not conducted fraud risk assessments for PPP and the COVID-19 EIDL program and recommended that it do so. When SBA developed its fraud risk assessments for the programs in October 2021, PPP had already stopped accepting new applications and the COVID-19 EIDL program would stop at the end of that year,” it wrote.
EIDL. PPP and EIDL together paid out nearly $1 trillion. Yet Congress explicitly blocked SBA from using tax returns to verify a business’s eligibility for EIDL loans, even though it is a highly relevant piece of information. “As a result, SBA relied on self-certification,” GAO said.
GAO reviewed a sample of loans processed without consulting tax returns and found that “about half of them” should not have been approved.
Congress removed the restriction nine months later, but SBA still didn’t bother verifying applications using tax returns in a timely manner. “Specifically, the SBA OIG found that for about 4 months after Congress removed the tax return prohibition, SBA made 133,832 COVID19 EIDL disbursements, totaling about $8.5 billion without proving applicant eligibility using official tax information,” it said.
Congress. While one might assume that agencies should not have to be told to try to mitigate fraud, Congress explicitly removed legal requirements relating to policing fraud from massive <a href="https://www.dailywire.com/news/100b-bonanza-pfizer-reports-record-sales-profits-behind-covid-vaccine-oral-treatment">coronavirus</a> appropriations bills. “Although federal laws have required agencies to submit specific internal control plans for relief funds in previous emergencies, there was no such requirement for the COVID-19 pandemic,” GAO wrote.
The Fraud Reduction and Data Analytics Act of 2015 and the Payment Integrity Information Act of 2019 “required agencies to report on their antifraud controls and fraud risk management efforts in their annual financial reports,” but that requirement ended in 2020 and has not been renewed by Congress.
Nearly half of states didn’t even try to get wrongly-paid benefits back. In May 2021, the Department of Labor’s inspector general found that when 19 states overpaid someone’s unemployment benefits, they did not even attempt to get the money back. “From April 2020 through September 2022, states and territories reported about $48.6 billion in overpayments across the UI programs,” GAO said.
No attempt to screen fraud in program that prioritized minority restaurant owners. The Restaurant Revitalization Fund attracted scrutiny for <a href="https://www.dailywire.com/news/bidens-restaurant-relief-program-excludes-white-male-owners" target="_blank" rel="noopener">excluding white males</a>, a provision that a judge ruled was <a href="https://www.dailywire.com/news/court-strikes-down-racial-gender-preferences-in-bidens-1-9-trillion-covid-relief-bill-that-discriminated-against-restaurant-owners" target="_blank" rel="noopener">unconstitutional</a>. The program also seemed to go out of its way to cater to minority fraudsters. While SBA, which ran the program, collected data that could be used to screen for fraud, the agency told GAO flatly that “they were not analyzing these data to detect potentially fraudulent recipients.”
Provider Relief Fund. This program, oddly enough, paid doctors and nurses who said they had lost business because of the nationwide medical emergency. In October 2021, GAO found that the Department of Health and Human Services did not even have procedures in place to recover overpayments. “While it took initial actions to address this recommendation, [HHS] suspended its post-payment recovery efforts in March 2022” to explore whether it even had the authority to claw back wrongfully-paid money. “According to HRSA, the agency is still in the process of determining its authority to recover overpayments” in some scenarios.
Emergency Rental Assistance. Another wildly controversial program involved rent payments. The program was administered by the U.S. Treasury. GAO “identified potentially duplicative emergency rental assistance payments but found that Treasury had not conducted a detailed risk assessment of the program’s susceptibility to improper payment, for example, by reviewing grantee payment data.” Treasury seemed uninterested: “Officials did not commit to additional steps to assess or address improper payment risks because of resource limitations.”
<div class="image"><img loading="lazy" class="alignnone size-full wp-image-496616" src="https://www.dailywire.com/wp-content/uploads/2023/02/gao-improper-payments.png" alt="" width="940" height="485" srcset="https://dw-wp-production.imgix.net/2023/02/gao-improper-payments.png 940w, https://dw-wp-production.imgix.net/2023/02/gao-improper-payments-300x155.png 300w, https://dw-wp-production.imgix.net/2023/02/gao-improper-payments-768x396.png 768w" sizes="(max-width: 940px) 100vw, 940px" /></div>
Coronavirus Food Assistance Program. The US Department of Agriculture paid $31 billion to farmers “to offset losses associated with the COVID-19 pandemic. GAO “reviewed claims of 90 producers with risk factors for improper payments and found that over half of these producers did not provide full support for their payments, potentially making it harder to identify payment errors and fraud.” It provided recommendations to USDA, but “the agency has not yet taken action to implement these recommendations.”
Affordable Connectivity Program. “In January 2023, we found that the Federal Communications Commission (FCC) had not developed an antifraud strategy to address identified fraud risks associated with the Affordable Connectivity Program,” GAO wrote.
The Office of Management and Budget said that federal agencies wrongfully paid out some quarter-trillion dollars in fiscal 2022. But GAO said even that shocking sum significantly understates it: OMB&#8217;s figure doesn&#8217;t include some of the most integrity-challenged programs, including pandemic uninsurance, food stamps, and welfare.
Related: <a href="https://www.dailywire.com/news/thousands-of-pandemic-unemployment-claims-listed-the-names-of-still-employed-government-workers-senator-says" target="_blank" rel="noopener">Thousands Of Pandemic Unemployment Claims Listed The Names Of Still-Employed Government Workers, Senator Says</a>

Agencies, Congress Didn’t Even Try To Stop Fraud In $4T Coronavirus Bailout, Audit Finds

Federal Agencies Didn’t Even Try To Stop Coronavirus Fraud, Blistering GAO Audit Says

Congress

Coronavirus

Coronavirus Relief

Inspector general

Small Business Administration

<a href="https://www.dailywire.com/topic/fbi" target="_blank" rel="noopener">Federal law enforcement</a> officials are reportedly investigating Rep. George Santos (R-NY) over his alleged involvement in a &#8220;GoFundMe scheme&#8221; that was set up for a disabled U.S. Navy veteran&#8217;s dog.
Santos <a href="https://www.politico.com/news/2023/02/01/feds-probing-santos-service-dog-charity-scheme-00080706" target="_blank" rel="noopener">told</a> Politico that two FBI agents contacted Richard Osthoff, the disabled Navy veteran, as part of an investigation being conducted by the U.S. Attorney’s Office in the Eastern District of New York.
Osthoff says that Santos raised $3,000 for life-saving surgery that was needed for his pit bull and then ran off with the money. He reportedly gave agents text message exchanges that he had with Santos.
“I’m glad to get the ball rolling with the big-wigs,” Osthoff said on Wednesday. “I was worried that what happened to me was too long ago to be prosecuted.”
The text messages, which were first reported by <a href="https://patch.com/new-york/oysterbay/disabled-veteran-george-santos-took-3k-dying-dogs-gofundme" target="_blank" rel="noopener">Patch</a>, allegedly show Santos going by the name Anthony Devolder and claiming that he had a pet charity called Friends of Pets United.
The New York Times <a href="https://www.nytimes.com/2022/12/19/nyregion/george-santos-ny-republicans.html" target="_blank" rel="noopener">reported</a> in December that there was no evidence the charity was even real.
The freshman congressman, who has admitted to lying about aspects of his career and personal life, is facing probes from federal and local authorities in addition to congressional investigations.
“With the ongoing attention surrounding both my personal and campaign financial investigations, I have submitted a request to Speaker McCarthy that I be temporarily recused from my committee assignments until I am cleared,” Santos <a href="https://www.dailywire.com/news/george-santos-releases-statement-on-stepping-down-from-committee-assignments" target="_blank" rel="noopener">said</a> in a statement. “This was a decision that I take very seriously.”
“The business of the 118th Congress must continue without media fanfare,” he continued. “It is important that I primarily focus on serving the constituents of New York’s Third Congressional District and providing federal level representation without distraction.”
Santos has already <a href="https://www.dailywire.com/news/new-york-rep-elect-who-made-false-statements-about-career-personal-life-admits-it" target="_blank" rel="noopener">admitted</a> that he fibbed about working for financial titans Goldman Sachs and Citigroup; he also admitted that he did not graduate from college. Furthermore, Santos admitted that he embellished some of the details of his personal life, his religion, and his sexuality.
The New York Times <a href="https://www.nytimes.com/2023/01/02/nyregion/george-santos-brazil.html" target="_blank" rel="noopener">reported</a> earlier this month that law enforcement officials in Brazil “intend to revive fraud charges” against Santos stemming from an incident in 2008 that involved a checkbook that was allegedly stolen.

Rep. George Santos Steps Aside from Committees Amid Calls For His Resignation

FBI Investigating George Santos’ Alleged Involvement In ‘GoFundMe Scheme’: Report

FBI Investigating George Santos' Alleged Involvement In 'GoFundMe Scheme': Report

Politics

Federal prosecutors requested that former FTX CEO <a href="http://dailywire.com/topic/sam-bankman-fried" target="_blank" rel="noopener">Sam Bankman-Fried</a> become subject to more restrictions during his pretrial release after he allegedly tried to tamper with a witness through the encrypted messaging platform Signal.
The former cryptocurrency executive is awaiting trial for various <a href="http://dailywire.com/topic/fraud" target="_blank" rel="noopener">fraud</a> charges after he commingled funds between FTX and sister trading company Alameda Research. United States Attorney Damian Williams from the Southern District of New York asked Judge Lewis Kaplan in a <a href="https://www.courtlistener.com/docket/66631291/50/united-states-v-bankman-fried/" target="_blank" rel="noopener">letter</a> to stop Bankman-Fried from contacting former FTX associates unless in the presence of counsel and asked that the disgraced entrepreneur lose access to Signal and similar platforms.
Bankman-Fried has allegedly been in contact with the current general counsel of FTX US, who might be a witness at the trial. He reportedly told the executive in a message that he “would really love to reconnect and see if there’s a way for us to have a constructive relationship, use each other as resources when possible, or at least vet things with each other.” Williams wrote that the request to “vet things with each other” is suggestive of an attempt to impact the witness’s testimony, while the “constructive relationship” appeal is an invitation to cooperate with him.
“Efforts by the defendant to improve his relationship with potential witnesses that may testify against him may itself constitute witness tampering,” he wrote. “Were the defendant to ‘vet’ his version of relevant events with potential witnesses, that might have the effect of discouraging witnesses from testifying in a manner contrary to the defendant’s narrative.”
Bankman-Fried can use Signal to “evade bail restrictions and pretrial oversight” since encrypted messages on the platform may autodelete after a short period of time. “The proposed bail conditions in combination would more effectively prevent the defendant from obstructing justice,” Williams added. “This proposed restriction will not inhibit the defendant’s ability to communicate with others as he could still use text message, email, and conventional telephone calls.”
Bankman-Fried pleaded <a href="https://www.dailywire.com/news/sam-bankman-fried-pleads-not-guilty-allowed-to-conceal-who-is-securing-his-250-million-bond" target="_blank" rel="noopener">not guilty</a> earlier this month to eight charges, including conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to defraud the Federal Election Commission through campaign finance violations. Mark Cohen, a lawyer for Bankman-Fried who previously <a href="https://www.dailywire.com/news/sam-bankman-fried-hires-attorney-who-defended-epstein-confidant-ghislaine-maxwell" target="_blank" rel="noopener">defended</a> Jeffrey Epstein confidant Ghislaine Maxwell, successfully requested that the names and addresses of two unknown individuals who secured a $250 million bond for Bankman-Fried remain sealed. The entrepreneur could spend as much as 115 years in prison if convicted on all counts.
Bankruptcy lawyers managing the insolvency of FTX have <a href="https://www.dailywire.com/news/ftx-bankruptcy-lawyers-reveal-how-much-they-have-clawed-back-for-defrauded-investors" target="_blank" rel="noopener">recovered</a> $5 billion of customer funds in the forms of cash, liquid cryptocurrency, and liquid investment securities. Authorities in the Bahamas, where FTX and other companies led by Bankman-Fried were headquartered, <a href="https://www.dailywire.com/news/bahamas-holding-3-5-billion-of-ftxs-cryptocurrency-for-safekeeping" target="_blank" rel="noopener">seized</a> $3.5 billion of assets in the days after the company’s collapse.
Bankman-Fried’s <a href="https://www.dailywire.com/news/officials-charge-sam-bankman-fried-of-using-customer-funds-for-lavish-real-estate-and-large-political-donations" target="_blank" rel="noopener">extensive political connections</a> came to public attention in the weeks after his company’s bankruptcy, including the $39 million he donated to Democrats ahead of the midterms and four <a href="https://www.dailywire.com/news/sam-bankman-fried-visited-biden-white-house-four-times-ahead-of-his-arrest" target="_blank" rel="noopener">meetings</a> he was granted at the White House with top officials Steve Richetti and Bruce Reed. The Senate Majority PAC, which exists to elect Democrats to the upper chamber of Congress, <a href="https://www.dailywire.com/news/democrats-say-they-will-return-3-million-donated-by-ftx-executives" target="_blank" rel="noopener">announced</a> plans to return $3 million donated by Bankman-Fried and another FTX executive.

Former CEO of FTX Sam Bankman-Fried leaves the Federal Court

Sam Bankman-Fried Attempted To Tamper With Witness, Prosecutors Allege

Sam Bankman-Fried Tried To Witness Tamper, Prosecutors Say

Sam Bankman-Fried

Thousands of federal employees may have wrongfully obtained coronavirus bailouts by claiming to be unemployed, with some even doing so from their desks at government offices, federal investigators found.
Sen. <a href="https://www.dailywire.com/news/senator-blasts-biden-for-compiling-naughty-list-of-peddlers-of-misinformation-like-the-lab-leak-theory" target="_blank" rel="noopener">Joni Ernst</a> (R-IA) is demanding answers, saying that the Pandemic Response Accountability Committee (PARC) should &#8220;recover the money that was ripped off, and grant each of those who took advantage of taxpayers by collecting jobless benefits their wish to be unemployed.&#8221;
&#8220;It is appalling for anyone fortunate enough to have the reliability of a government paycheck to take advantage of financial assistance intended to provide a lifeline to Americans who lost their jobs or were unable to work as a result of the COVID-19 pandemic,&#8221; Ernst added.
A variety of government programs paid significant sums to people who said their jobs had been impacted by coronavirus in 2020. The Department of Homeland Security&#8217;s Inspector General <a href="https://www.oig.dhs.gov/sites/default/files/assets/2022-09/OIG-22-73-Sep22.pdf" target="_blank" rel="noopener">found</a> that nearly 2,000 applications for &#8220;Lost Wages Assistance&#8221; and unemployment insurance payouts had the names of DHS employees who were ineligible since they were, of course, employed by the government agency.
In fact, of 2,393 applications filed with DHS employees&#8217; names, only 584 could be confirmed as actually eligible for the program — and even some of those bore signs of fraud, such as incorrect amounts.
Benefits could also be paid to people whose hours were cut back because of the pandemic, but in 366 cases, the name associated with the unemployment claim actually worked overtime during the relevant period, the audit found.
In some cases, the fraud may have been the result of criminals stealing the employees’ identities and successfully filing unemployment claims with them. In others, there were indications that the employees were to blame, including that some government assistance forms were actually filled out from computers registering to the DHS computer network.
Either way, fraud was able to occur because DHS had few security measures in place for verifying assistance claims despite being tasked with keeping the nation safe.
&#8220;This occurred because FEMA hastily implemented the LWA program in 11 days, during an unprecedented pandemic, without developing program controls to prevent fraud,&#8221; auditors wrote.
Ernst wrote Friday to Michael Horowitz, chair of the PARC, that &#8220;Employees of other federal agencies, including the Internal Revenue Service, Amtrak, and the U.S. Postal Service have also been caught fraudulently collecting unemployment payments, despite being on the federal payroll.”
On January 4, the state of <a href="https://oig.georgia.gov/press-releases/2023-01-04/oig-publishes-open-letter-regarding-ui-fraud-state-government" target="_blank" rel="noopener">Georgia&#8217;s inspector general</a> said that &#8220;we have tentatively identified over 280 full-time state employees who erroneously received unemployment insurance (UI) payments in 2020 or 2021. These payments averaged $23,700 per employee and totaled over $6.7 million. And this is a conservative estimate.&#8221;
Those included &#8220;Two Department of Human Services DCSS/DFCS supervisors who received approximately $49,730 and $36,575&#8221; and a state employee whose job was to evaluate unemployment claims, but who himself &#8220;received approximately $31,220 and who continued to update a fraudulent UI account while employed with&#8221; the Georgia Department of Labor.
In October, the <a href="https://www.justice.gov/opa/pr/five-current-or-former-irs-employees-charged-defrauding-federal-covid-19-relief-programs" target="_blank" rel="noopener">Department of Justice</a> said it had charged five former or current IRS employees with pandemic fraud seeking more than $1 million, which they allegedly used on &#8220;cars, luxury goods, and personal travel, including trips to Las Vegas.&#8221; But the inspector general for the Small Business Administration (SBA), which administered the largest coronavirus programs, has <a href="https://www.dailywire.com/news/hunter-bidens-laptop-lady-got-20k-federal-stimulus-for-female-owned-sole-proprietorship" target="_blank" rel="noopener">acknowledged</a> that so much money was paid out in such a short amount of time, and with <a href="https://www.dailywire.com/news/coronavirus-loan-fraud-prevention-fell-to-unvetted-firms-that-profited-hugely-while-ignoring-fraud-congress-finds" target="_blank" rel="noopener">so few safeguards</a>, that only a tiny fraction of suspicious cases have even been investigated.
SBA doled out forgivable &#8220;loans&#8221; to business owners whose livelihood was ostensibly interrupted by COVID, known as PPP or EIDL payments. In its most recent <a href="https://www.pandemicoversight.gov/sites/default/files/2022-12/PRAC_Semiannual_Report_Sept_2022_0.pdf" target="_blank" rel="noopener">semiannual report</a> to Congress, PARC said that by matching the information of federal employees with these payments, six federal agencies found &#8220;tens of thousands of employees with SBA loans for which they were not eligible.&#8221;
Cross-referencing that list of names — people with stable jobs whose identities are readily known to the government because they work for it — could yield many more problematic unemployment claims at other agencies, <a href="https://www.dailywire.com/news/federal-watchdog-slams-faucis-agency-and-ecohealth-over-deal-with-wuhan-lab" target="_blank" rel="noopener">Ernst</a> said. &#8220;I would encourage you to conduct a similar review to determine how many unscrupulous bureaucrats wrongfully took advantage of the federal pandemic unemployment and lost wages assistance programs,&#8221; she wrote.

Senators Meet For Their Weekly Policy Luncheons

Thousands Of Pandemic Unemployment Claims Listed The Names Of Still-Employed Government Workers, Senator Says

Department of Homeland Security

Joni Ernst

Robert Belfer, an oil entrepreneur and the patriarch of the elite Belfer family, lost money during the bankruptcy of cryptocurrency platform <a href="https://www.dailywire.com/topic/sam-bankman-fried" target="_blank" rel="noopener">FTX</a> years after he suffered hits from the collapse of fraudulent energy company Enron and the Ponzi scheme led by Bernie Madoff.
Court documents show that investment funds linked to the Belfer family were included in a list of shareholders for FTX, the fraudulent digital asset company led by 30-year-old Sam Bankman-Fried, according to a <a href="https://www.ft.com/content/2c70076a-3c59-4183-b4c6-79fb202a8b98" target="_blank" rel="noopener">report</a> from Financial Times. Belfer Investment Partners and Lime Partners, both of which are linked to the family, held a combined $34.5 million in the company as of the beginning of last year.
Robert Belfer and his wife, Renée, are philanthropists who have donated heavily to the Metropolitan Museum of Art in New York City; the institution’s Greek and Roman galleries bear the Belfer name, as does the international affairs center at Harvard Kennedy School. Robert Belfer is the son of Arthur Belfer, who moved to the United States from Poland soon after Nazi Germany invaded the country. He imported feathers for pillows and sleeping bags before his company began dealing in foam rubber and petroleum products.
Belco Petroleum Corporation later became a Fortune 500 company and was acquired by a predecessor of Enron, making the Belfer family stakeholders in the company. Robert Belfer served on the board of Enron until 2002, five years before the company was rendered insolvent in a development that cost the Belfers some $2 billion.
The family, down to a net worth of approximately $110 million, had a stroke of luck by withdrawing $28 million from the investment advisory run by Bernie Madoff. The late financier’s Ponzi scheme was discovered shortly after the stock market crash of 2008. Irving Picard, the trustee appointed to claw back funds on behalf of the Madoff victims, filed suit against the family to obtain investments in an attempt to aid other victims, according to a <a href="https://nypost.com/2023/01/16/oil-tycoon-robert-belfer-lost-a-fortune-with-enron-madoff-and-ftx/" target="_blank" rel="noopener">report</a> from the New York Post. The result of the legal proceedings is unknown.
Bankman-Fried, whose alleged misconduct has often been compared to the Madoff scheme, pleaded <a href="https://www.dailywire.com/news/sam-bankman-fried-pleads-not-guilty-allowed-to-conceal-who-is-securing-his-250-million-bond" target="_blank" rel="noopener">not guilty</a> earlier this month to eight charges, including conspiracy to commit wire fraud and conspiracy to commit securities fraud. Celebrities such as Tampa Bay Buccaneers quarterback Tom Brady and supermodel ex-wife Gisele Bündchen received combinations of equity and cryptocurrencies as reimbursement for appearing in advertisements and publicly endorsing FTX; they now face a <a href="https://www.dailywire.com/news/tom-brady-steph-curry-other-celebrities-sued-for-pushing-ponzi-scheme-ftx" target="_blank" rel="noopener">lawsuit</a> accusing them of participating in a “fraudulent scheme” against unsophisticated investors.
FTX collapsed after users learned that their funds were commingled with sister trading firm Alameda Research, which was led by a former love interest of Bankman-Fried. A number of individual users and institutional clients had as much as $8 billion remaining with the company, which Bankman-Fried had attempted to <a href="https://www.dailywire.com/news/former-crypto-billionaire-sam-bankman-fried-whose-entire-fortune-just-went-to-zero-is-calling-around-for-new-investors" target="_blank" rel="noopener">solicit</a> from investors with little success. John Ray III, a bankruptcy lawyer who was appointed to lead the FTX bankruptcy proceedings, <a href="https://www.dailywire.com/news/lawyer-overseeing-ftx-fallout-never-in-my-career-have-i-seen-such-a-complete-failure" target="_blank" rel="noopener">told</a> lawmakers that he had never seen “such a complete failure of corporate controls and such a complete absence of trustworthy financial information.”
Bankman-Fried and fellow executives had used the funds to purchase luxury tropical real estate and make sizable political contributions to Democratic candidates. Attorneys have <a href="https://www.dailywire.com/news/ftx-bankruptcy-lawyers-reveal-how-much-they-have-clawed-back-for-defrauded-investors" target="_blank" rel="noopener">recovered</a> some $5 billion in assets to repay defrauded customers and investors.

Hope on the Horizon Alzheimer’s Drug Discovery Foundation Eighth Annual Fall Symposium & Luncheon

Fool Me Thrice: New York Businessman Fell Prey To Enron, Madoff, And FTX Scams

Businessman Fell Prey To Enron, Madoff, And FTX Scams

Cryptocurrency

Former <a href="http://dailywire.com/topic/theranos" target="_blank" rel="noopener">Theranos</a> CEO <a href="https://www.dailywire.com/topic/elizabeth-holmes" target="_blank" rel="noopener">Elizabeth Holmes</a> attempted to flee the country after she was found guilty on multiple charges last year, attorneys said Thursday.
The disgraced biotechnology entrepreneur was <a href="https://www.dailywire.com/news/elizabeth-holmes-found-guilty-on-four-counts-of-defrauding-theranos-investors" target="_blank" rel="noopener">convicted</a> on four counts of wire fraud in early January 2022 and was <a href="https://www.dailywire.com/news/breaking-elizabeth-holmes-disgraced-media-darling-behind-theranos-fraud-sentenced-to-11-years-in-prison" target="_blank" rel="noopener">sentenced</a> to 11 years in prison in November. Federal prosecutors revealed in a <a href="https://s3.documentcloud.org/documents/23581015/us-v-holmes-gov-opp-motion-for-release-pending-appeal.pdf" target="_blank" rel="noopener">court document</a> responding to a request from Holmes for release pending appeal that she “booked an international flight to Mexico” in January 2022 without scheduling a return trip and only canceled the purchase after the defense counsel was notified.
“The government anticipates Defendant will note in reply that she did not in fact leave the country as scheduled,” the document added, “but it is difficult to know with certainty what Defendant would have done had the government not intervened.”
The document said that William “Billy” Evans, who married Holmes in 2019, allegedly departed the country “on the scheduled date with a one-way ticket and did not return until approximately six weeks later, returning from a different continent.” Officials asserted that Holmes “continues to show no remorse to her victims” and is currently seeking to “loosen the restrictions placed on her region of travel based upon vague references to her partner’s work commitments.” She was also granted a lenient amount of time to begin her prison sentence because she and Evans, an heir to a sizable hospitality fortune, are expecting their second child.
“Defendant, however, cannot meet the stringent standard for release pending appeal mandated by Congress. There are not two systems of justice, one for the wealthy and one for the poor, there is one criminal justice system in this country. And under that system, the time has come for Elizabeth Holmes to answer for her crimes committed nearly a decade ago,” the document continued.
Holmes deceived investors into believing that her company’s portable blood analyzer could conduct comprehensive medical tests with mere drops of blood. Her collapsed empire once secured a $9 billion valuation, and she was previously touted by Forbes as the world’s youngest self-made female billionaire.
The Stanford University dropout managed to attract several prominent political and business leaders to back her firm, including former Secretary of State George Shultz and former Defense Secretary James Mattis. She also had close ties to the Clinton family and hosted a fundraiser for Democratic presidential nominee Hillary Clinton in 2016.
Production delays in Theranos machines led the company to <a href="https://www.dailywire.com/news/how-did-elizabeth-holmes-build-her-fraudulent-biomedical-empire" target="_blank" rel="noopener">secretly use</a> traditional blood testing machines manufactured by Siemens and other established firms to complete tests for their partners. In the absence of a functioning device, Holmes still convinced board members, prospective investors, and journalists that her company’s product had been finished.
Ramesh “Sunny” Balwani, the former business and romantic partner of Holmes, has been sentenced to nearly 13 years in prison. Holmes tried to blame Balwani for abuse during her trial, even though <a href="https://www.dailywire.com/news/texts-between-theranos-founder-elizabeth-holmes-and-ex-boyfriend-cast-doubt-on-her-abuse-claims" target="_blank" rel="noopener">text messages</a> between the pair showed a meaningful relationship despite Balwani’s reputation for treating employees poorly.

Theranos Founder Elizabeth Holmes Sentenced For Fraud Conviction

Theranos Fraudster Elizabeth Holmes Tried Fleeing The Country After Conviction, Court Filings Reveal

Theranos Fraudster Elizabeth Holmes Tried Fleeing The Country

Elizabeth Holmes

Theranos

Anatoly Legkodymov, the founder of <a href="http://dailywire.com/topic/cryptocurrency" target="_blank" rel="noopener">cryptocurrency</a> platform Bitzlato, was <a href="http://dailywire.com/topic/crime" target="_blank" rel="noopener">arrested</a> in Florida on Tuesday evening after his company allegedly processed more than $700 million in illicit <a href="http://dailywire.com/topic/fraud" target="_blank" rel="noopener">funds</a>.
The company run by Legkodymov, a Russian national who resides in China, allegedly “transported and transmitted” illicit funds while failing to comply with American safeguards against money laundering, according to a <a href="https://www.justice.gov/opa/pr/founder-and-majority-owner-cryptocurrency-exchange-charged-processing-over-700-million" target="_blank" rel="noopener">press release</a> from the Justice Department. Bitzlato allegedly permitted users on Hydra, an “anonymous, illicit online marketplace for narcotics, stolen financial information, fraudulent identification documents, and money laundering services,” to exchange more than $700 million in cryptocurrency.
“Institutions that trade in cryptocurrency are not above the law and their owners are not beyond our reach,” U.S. Attorney Breon Peace of the Eastern District of New York said in a statement. “As alleged, Bitzlato sold itself to criminals as a no-questions-asked cryptocurrency exchange, and reaped hundreds of millions of dollars’ worth of deposits as a result. The defendant is now paying the price for the malign role that his company played in the cryptocurrency ecosystem.”
Bitzlato required minimal user authentication, rendering the platform a “haven for criminal proceeds and funds intended for use in criminal activity,” according to the press release. Beyond the $700 million in assets transferred by users on Hydra, which was shuttered by American and German authorities last year, Bitzlato received some $15 million in ransomware proceeds. Hydra users allegedly admitted to Bitzlato personnel that they were using the cryptocurrency platform under false identities, and Legkodymov allegedly told a colleague on the company’s internal chat system many users were “known to be crooks.”
The Treasury Department requires financial institutions to implement stringent due diligence procedures for users, including a “requirement to identify and verify the identity of beneficial owners,” according to a <a href="https://www.govinfo.gov/content/pkg/FR-2016-05-11/pdf/2016-10567.pdf" target="_blank" rel="noopener">rule</a> from the agency’s Financial Crimes Enforcement Network.
“As alleged, the defendant helped operate a cryptocurrency exchange that failed to implement required anti-money laundering safeguards and enabled criminals to profit from their wrongdoing, including ransomware and drug trafficking,” Assistant Attorney General Kenneth Polite said in a statement.
The arrest of Legkodymov follows the <a href="https://www.dailywire.com/news/sam-bankman-fried-pleads-not-guilty-allowed-to-conceal-who-is-securing-his-250-million-bond" target="_blank" rel="noopener">indictment</a> of former FTX CEO Sam Bankman-Fried on a number of charges, which include conspiracy to commit wire fraud, conspiracy to commit securities fraud, and conspiracy to commit money laundering. The entrepreneur garnered worldwide controversy after users learned that he commingled funds between FTX and sister trading firm Alameda Research, losing untold billions of customer assets.
The bankruptcy of FTX has also spurred lawmakers to call for increased scrutiny of the cryptocurrency sector. Members of the Senate <a href="https://www.dailywire.com/news/top-commodities-regulator-tells-senators-he-met-with-sam-bankman-fried-10-times" target="_blank" rel="noopener">considered</a> various proposals for more regulations on digital asset markets with Commodity Futures Trading Commission Chairman Rostin Behnam, while members of the House of Representatives <a href="https://www.dailywire.com/news/attorney-overseeing-ftx-bankruptcy-testifies-before-congress-grossly-inexperienced-people-ran-company-went-on-5-billion-spending-binge" target="_blank" rel="noopener">discussed</a> the bankruptcy proceedings of FTX with attorney John Ray III.
House Financial Services Committee Chairman Patrick McHenry (R-NC), for instance, asserted that regulation is necessary for the continuation of a legitimate cryptocurrency sector. “It appears to be the same old-school fraud, just using new technology,” he said. “We have to separate out the bad actions of an individual from the good created by an industry.”

Justice Department Announces Major Cryptocurrency Enforcement Action

Cryptocurrency Founder Nabbed After Allegedly Enabling $700 Million In ‘Ransomware And Drug Trafficking’ Schemes

Cryptocurrency Founder Nabbed After Allegedly Enabling Massive Amounts Of Fraud

Reality TV stars <a href="https://people.com/tv/todd-chrisley-julie-chrisley-report-to-prison/?hid=4f90b78dc31e627328d98338e1fa49d03b364abc&amp;did=8020388-20230117&amp;utm_source=ppl&amp;utm_medium=email&amp;utm_campaign=people-news_newsletter&amp;utm_content=011723&amp;lctg=4f90b78dc31e627328d98338e1fa49d03b364abc" target="_blank" rel="noopener">Todd and Julie Chrisley</a> of &#8220;Chrisley Knows Best&#8221; reported to prison to start each of their sentences after being convicted in June and sentenced in November for fraud and tax evasion.
The reality star, 54-year-old Todd, reported on Tuesday to the Federal Prison Camp Pensacola to serve out his 12-year prison sentence, <a href="https://people.com/tv/todd-chrisley-julie-chrisley-report-to-prison/?hid=4f90b78dc31e627328d98338e1fa49d03b364abc&amp;did=8020388-20230117&amp;utm_source=ppl&amp;utm_medium=email&amp;utm_campaign=people-news_newsletter&amp;utm_content=011723&amp;lctg=4f90b78dc31e627328d98338e1fa49d03b364abc" target="_blank" rel="noopener">People</a> magazine reported. His wife, 50-year-old reality star Julie, on the same day, reported to the Federal Correctional Institution and Federal Prison Camp Marianna to begin the start of her seven-year sentence, the outlet confirmed.
A representative for both stars had no further comment. The pair were convicted last year of conspiracy to commit bank fraud, bank fraud, tax fraud, and conspiracy to defraud the United States, as <a href="https://www.dailywire.com/news/reality-stars-todd-and-julie-chrisley-sentenced-to-prison" target="_blank" rel="noopener">The Daily Wire</a> previously reported. In addition, Julie was also convicted on a charge of wire fraud and obstruction of justice.
In November, the couple was sentenced to a total of 19 years behind bars after a jury convicted the pair for their multimillion-dollar bank fraud and tax evasion scheme, the outlet noted. Both were also ordered to serve an additional 16 months of probation following their individual releases.
The pair previously released a statement to People about how they were in the process of appealing their convictions.
Chrisley&#8217;s attorney, Alex Little of Burr &amp; Forman LLP, said in a statement, in part, &#8220;Their trial was marred by serious and repeated errors, including the government lying to jurors about what taxes the couple paid. Based on these issues, we are optimistic about the road ahead.&#8221;
Musa Ghanayem, the attorney for Lindsie Chrisley, the couple&#8217;s daughter, told the magazine about what the legal steps were for Todd and Julie&#8217;s appeal process.
&#8220;The legal process would be if a new trial was ordered, they&#8217;d have to go through the whole process again,&#8221; the attorney shared at the time. &#8220;If there was an issue that was incorrect, it can be sent back down to be correct[ed]. Typically, the appellate panel will make a decision, make a ruling, and sometimes send it back down to enforce that ruling.&#8221;
Related: <a href="https://www.dailywire.com/news/reality-stars-todd-and-julie-chrisley-sentenced-to-prison" target="_blank" rel="noopener">Reality Stars Todd And Julie Chrisley Sentenced To Prison</a>

Chrisley Knows Best – Season 8

Reality TV Stars Todd And Julie Chrisley Start Prison Sentences

Celebrities

Prison

Reality TV

<a href="https://www.dailywire.com/topic/jp-morgan" target="_blank" rel="noopener">JPMorgan Chase</a> shuttered the college financial aid platform Frank, which the investment <a href="http://dailywire.com/topic/banks" target="_blank" rel="noopener">bank</a> acquired for $175 million two years ago, and sued founder Charlie Javice after learning that she allegedly fabricated more than 90% of the website’s accounts.
The <a href="https://www.documentcloud.org/documents/23570243-frank_suit?utm_source=newsletter&amp;utm_medium=email&amp;utm_campaign=newsletter_axiosprorata&amp;stream=top#_ga=2.126901833.551224049.1673548424-1989375623.1673363276" target="_blank" rel="noopener">complaint</a> filed by JPMorgan accused Javice of falsely claiming in documents, pitch materials, and verbal presentations that more than 4.25 million students had created accounts with Frank to manage their financial aid applications. The bank said analysts confirmed that some 4 million of the accounts were fake after test emails were sent to hundreds of thousands of supposed customers and only successfully reached 28% of the users. Slightly more than 1% of the delivered emails were opened, falling far short of the typical 30% rate seen by the bank.
The lawsuit said Javice had a choice between “revealing the truth about her startup” or “lying to inflate Frank’s value” in every interaction she had with JPMorgan. “Javice chose each time to lie, and the evidence shows that time and again she layered fraud upon fraud,” the bank concluded.
Javice became an employee of JPMorgan following the $175 million acquisition, which was completed in 2021. She successfully bargained for an additional $20 million retention bonus in her employment contract.
Javice had filed suit against JPMorgan days before they filed the complaint against her, claiming she was owed millions of dollars for expenses she incurred during an internal investigation that began last spring, according to a <a href="https://www.wsj.com/articles/jpmorgan-bought-college-financial-aid-platform-for-175-millionand-now-says-most-of-its-users-were-fake-11673470572?utm_source=newsletter&amp;utm_medium=email&amp;utm_campaign=newsletter_axiosprorata&amp;stream=top#_ga=2.126820041.551224049.1673548424-1989375623.1673363276" target="_blank" rel="noopener">report</a> from the Wall Street Journal. Alex Spiro, an attorney representing Javice, told the outlet that the lawsuit from JPMorgan was “nothing but a cover.” He alleged that the bank “rushed to acquire” the company, then realized “they couldn’t work around existing student privacy laws, committed misconduct and then tried to retrade the deal.”
The <a href="https://withfrank.org/" target="_blank" rel="noopener">website</a> for Frank currently says the service is “no longer available.”
JPMorgan claimed that Javice refused to provide the company with a list of customers due to “privacy concerns.” When analysts insisted, she and Olivier Amar, another executive at Frank, allegedly approached the company’s director of engineering and asked him to create fake customers using computer algorithms. When the engineer declined to participate in the scheme, Javice and Amar allegedly paid a data science professor to create millions of customer profiles with names, email addresses, and birthdays to provide to JPMorgan.
The lawsuit added that Javice was particularly concerned with the email addresses, asking the professor whether they would “look real with an eye check.”
Javice founded Frank in 2017 and earned a <a href="https://www.forbes.com/profile/charlie-javice/?sh=782964829619" target="_blank" rel="noopener">spot</a> on the Forbes 30 Under 30 list two years later. Other investors in the company had included Apollo Global Management CEO Marc Rowan and education technology company Chegg, according to a <a href="https://www.businesswire.com/news/home/20210921005169/en/JPMorgan-Chase-Acquires-Frank-the-Leading-College-Financial-Planning-Platform-for-Students" target="_blank" rel="noopener">press release</a> from JPMorgan.
A glowing <a href="https://www.forbes.com/sites/dereknewton/2018/09/05/this-26-year-old-ceo-found-students-7-billion-in-financial-aid/?sh=10ce28e37e63" target="_blank" rel="noopener">profile</a> of Javice published by Forbes noted the entrepreneur’s selfless desire to help students attain higher education. The author said she “sounds like an eager data analyst when she talks about the matching problem and how it triggers other issues of equity and access.”
The lawsuit comes after FTX, the cryptocurrency exchange platform launched by Sam Bankman-Fried, filed for bankruptcy after users <a href="https://www.dailywire.com/news/30-year-old-billionaire-loses-entire-fortune-overnight-as-his-bahamas-based-cryptocurrency-empire-implodes" target="_blank" rel="noopener">learned</a> their deposits were commingled with Alameda Research, a trading firm also controlled by the young entrepreneur. Bankman-Fried and his associates likewise <a href="https://www.dailywire.com/news/left-of-center-media-accepted-millions-from-democrat-donor-and-disgraced-crypto-wunderkind-sam-bankman-fried" target="_blank" rel="noopener">received</a> gushing profiles in the mainstream media after donating millions of dollars to various outlets. A self-described “effective altruist,” Bankman-Fried later admitted that his supposed generosity was a ploy to earn the trust of “woke westerners.”

C24C4193-7A38-47EB-A56F-5922E3F43408_1_201_a

JPMorgan Closes Website They Bought For $175 Million After Claiming Founder Faked Over 90% Of Accounts

JPMorgan Shutters Website They Bought For $175 Million After Claiming Founder Faked Over 90% Of Accounts

Banks

Economy

JP Morgan

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