Feds Charge Brokers in $1B Subprime Fraud

Limits 'honest services' prosecutions for white collar crimes

(AP) - The Supreme Court ruled today that prosecutors erred in using a federal fraud law to convict former Enron chief executive Jeffrey Skilling, but left it to a lower court to determine whether his conviction should be overturned. The justices were unanimous in imposing limits on the use of the federal "honest services" fraud law that has been a favorite of white-collar crime prosecutors. In a related opinion, they also ordered a new a hearing for former newspaper magnate Conrad Black. More»

(NEWSER) - Bernie Madoff has reached his destination for the next 150 years or so. Clad in a blue jumpsuit, the fraudulent financier arrived at Butner Federal Correctional Complex in North Carolina just before noon today, ABC News reports. But the 71-year-old can take heart, because he “hit the inmate lottery,” by being assigned to Butner, according to one federal sentencing attorney. More»

Allegedly duped victims of millions in tale of deception, bravado

(NEWSER) - A bizarre case is unfolding around Marc Dreier, the Yale- and Harvard-educated Manhattan attorney arrested Sunday for his alleged involvement in a fraudulent scheme to sell hundreds of millions in forged, phony debt. Investigators contend his scams were nothing more than brazen confidence games in which he leveraged his position, extensive wealth, and clout to swindle hedge funds hungry for deals, the New York Times reports. More»

Alberto Vilar cheated investors to pay debts, fund opera companies

(NEWSER) - Alberto Vilar, the investment banker and one of the world's most generous opera patrons, was convicted yesterday on 12 counts of fraud, Bloomberg reports. Vilar told investors that he was putting their money in safe, government-backed assets; in fact, he bought risky tech stocks on margin, which quickly tanked. Vilar also defrauded clients by using their money to pay off other investors and to fulfill his many charitable contributions. More»

(NEWSER) - A short-staffed FBI is laboring to keep up with white collar crime linked to the nation's financial crisis, the New York Times reports. FBI officials predicted millions of dollars' in mortgage fraud years ago, but the Justice Department wanted agents focused on counter-terror. When the FBI warned of a fraud "epidemic" in 2004, only 15 of its 13,000 agents were on the case. More»