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THIS WEEK EVERY WEEK ON
WHITE PLAINS WEEK
FOR 21 YEARS FIRST SHOW JANUARY 2001
WHITE PLAINS WEEK THE DEC 23 REPORT ON www.wpcommunitymedia.org
TONIGHT AT 7 ON “PEOPLE TO BE HEARD” FIOS CH 45 AND OPTIMUM WHITE PLAINS CH. 76 AND ON www.wpcommunitymedia.org: WHAT YOU NEED TO KNOW ABOUT PLAYING PRO FOOTBALL FROM SAN FRANCISCO 49ERS GREAT FULLBACK DELVIN WILLIAMS
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CRYPTO CON FBI CRACKDOWN CONTINUES! ANOTHER CO-FOUNDER OF MASSIVE WORLDWIDE MULTI-BILLION-DOLLAR CRYPTOCURRENCY PYRAMID SCHEME “ONECOIN” PLEADS GUILTY. PARTNER IN CRIME STILL AT LARGE. FBI SEEKS CONFIDENTIAL INFO ON WHEREABOUTS OF RUJA IGNATOVA “THE CRYPTOQUEEN.”
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If you have any information about IGNATOVA’s whereabouts, please contact your local FBI office or the nearest American Embassy or Consulate. Tips can be reported anonymously and can also be reported online at tips.fbi.gov.
OneCoin Was a Fraudulent Cryptocurrency Marketed and Sold to Millions of Victims Around the World.
CO-FOUNDER REFERRED TO INVESTORS IN ONECOIN AS “IDIOTS.” “The network would not work with intelligent people.”
WPCNR FBI WIRE. From the Federal Bureau of Investigation. December 22, 2002:
Damian Williams, the United States Attorney for the Southern District of New York, announced Friday, December 16 that KARL SEBASTIAN GREENWOOD, who co-founded OneCoin with RUJA IGNATOVA, a/k/a “the Cryptoqueen,” pled guilty Friday in Manhattan federal court to wire fraud and money laundering charges in connection with his participation in the massive OneCoin fraud scheme.
OneCoin, which began operations in 2014 and was based in Sofia, Bulgaria, marketed and sold a fraudulent cryptocurrency by the same name through a global multi-level-marketing (“MLM”) network.
As a result of misrepresentations that GREENWOOD, IGNATOVA, and others made about OneCoin, victims invested over four billion dollars worldwide in the fraudulent cryptocurrency. Today, District Judge Edgardo Ramos accepted GREENWOOD’s guilty plea.
IGNATOVA, WHO was added to the Federal Bureau of Investigation’s Top Ten Most Wanted List in June 2022, remains at large.
U.S. Attorney Damian Williams said:
“As a founder and leader of OneCoin, Karl Sebastian Greenwood operated one of the largest international fraud schemes ever perpetrated.
“Greenwood and his co-conspirators, including fugitive Ruja Ignatova, conned unsuspecting victims out of billions of dollars, claiming that OneCoin would be the ‘Bitcoin killer.’ In fact, OneCoins were entirely worthless. Greenwood’s lies were designed with one goal, to get everyday people all over the world to part with their hard-earned money — real money — and to line his own pockets to the tune of hundreds of millions of dollars.
This guilty plea by the co-founder of OneCoin caps a week at SDNY that sends a clear message that we are coming after all those who seek to exploit the cryptocurrency ecosystem through fraud, no matter how big or sophisticated you are.”
According to the allegations in the Superseding Information and other filings and statements made in court:
In 2014, GREENWOOD and IGNATOVA co-founded OneCoin,[1] a company based in Sofia, Bulgaria, that marketed a purported cryptocurrency by the same name, which was in fact a fraudulent pyramid scheme.
OneCoin operated as a MLM network through which members received commissions for recruiting others to purchase cryptocurrency packages. This MLM structure influenced rapid growth of the OneCoin member network. Indeed, according to OneCoin’s promotional materials, over three million people invested in fraudulent cryptocurrency packages. OneCoin records show that, between the fourth quarter of 2014 and the fourth quarter of 2016 alone, OneCoin generated €4.037 billion in sales revenue and earned “profits” of €2.735 billion.
IGNATOVA served as OneCoin’s top leader until her disappearance from public view, in October 2017.
GREENWOOD was OneCoin’s “global master distributor” and the leader of the MLM network through which the fraudulent cryptocurrency was marketed and sold.
In a video posted online, IGNATOVA attributed to GREENWOOD the idea of marketing and selling OneCoin through an MLM network structure.
GREENWOOD earned approximately €20 million a month in his role as the top MLM distributor of OneCoin.
GREENWOOD and IGNATOVA conceived of and built the OneCoin business fully intending to use it to defraud investors. For example, in the summer of 2014, when GREENWOOD and IGNATOVA were developing the concept for OneCoin, they referred to the cryptocurrency in email correspondence as “trashy coin.” On June 11, 2014, IGNATOVA wrote to GREENWOOD concerning the OneCoin business plan, stating in part:
“It might not be [something] really clean or that I normally work on or even can be proud of (except with you in private when we make the money) – but . . . I am especially good in this very borderline cases [sic], where the things become gray – and you as the magic sales machine – and me as someone who really can work with numbers, legal and back you up in a good and professional way – we could really make it big – like MLM meets bitch of wall street ;-)”
In an August 9, 2014, email between GREENWOOD and IGNATOVA, IGNATOVA described her thoughts on the “exit strategy” for OneCoin. The first option that IGNATOVA listed was, “Take the money and run and blame someone else for this . . . .”
And in a September 11, 2016, exchange with IGNATOVA’s brother, Konstantin Ignatov, GREENWOOD referred to OneCoin investors stating, “These ppl are idiots,” to which Ignatov responded, “as you told me, the network would not work with intelligent people ;)”
HOW IT WORKED:
As a result of misrepresentations made by GREENWOOD, IGNATOVA, and other OneCoin representatives, victims throughout the world wired investment funds to OneCoin-controlled bank accounts in order to purchase OneCoin packages.
OneCoin falsely claimed that the value of OneCoin was based on market supply and demand, when in fact, the value of the cryptocurrency was simply set by OneCoin itself. For example, on June 9, 2014, in an email sent by IGNATOVA to a representative of a blockchain development company, copying GREENWOOD, IGNATOVA stated, “we are building our own cryptocurrency – and would like to set up an internal exchange service for them. We would like to be able to set the price manually and automatically and also control the traded volume.”
On March 21, 2015, IGNATOVA wrote an email to GREENWOOD, in which IGNATOVA stated, “We can manipulate the exchange by simulating some volatility and intraday pricing.” (bold in original). And in an August 1, 2015, email, IGNATOVA wrote to GREENWOOD, and included as part of a section of the email entitled “Goals”: “6. Trading coin, stable exchange, always close on a high price end of day open day with high price, build confidence – better manipulation so they are happy.”
The purported value of a OneCoin grew steadily from €0.50 to approximately €29.95 per coin. The purported price of OneCoins never decreased in value.
GREENWOOD and other OneCoin leaders also claimed that the OneCoin cryptocurrency was “mined” using mining servers maintained and operated by the company.
In fact, OneCoins were never mined using computer resources. For example, in an email to IGNATOVA dated August 11, 2014, GREENWOOD proposed, “Get members to think that they are mining their OneCoin via crunching (exchanging) tokens for OneCoin. This storey [sic] is good as ppl will then not go super crazy and just try and sell tokens all the time.”
GREENWOOD emailed IGNATOVA the following day, writing,
“The concept of converting tokens into OneCoin is an important phase for validity and truth behind the OneCoin. The so called ‘mining’ of coins is a concept that is very familiar in the industry and a story we can sell to the members.”
IGNATOVA then wrote to GREENWOOD, “We are not mining actually – but telling people shit,” to which GREENWOOD responded, “how can this be investigated and found out?” and “Can any member (trying to be clever) find out that we actually are not investing in machines to mine but it is merely a piece of software doing this for us?”
GREENWOOD and other OneCoin leaders further claimed that OneCoin maintained a private “blockchain,” or a digital ledger identifying OneCoins and recording historical transactions.
But OneCoin lacked a true blockchain, that is, a public and verifiable blockchain. Indeed, by approximately March 2015, IGNATOVA and GREENWOOD had started allocating to OneCoin members coins that did not even exist in OneCoin’s purported private blockchain, referring to those coins as “fake coins.”
GREENWOOD and IGNATOVA promoted OneCoin, including at official OneCoin events all over the globe.
One such event, called “Coin Rush,” was held at Wembley Arena in London on June 11, 2016.
Thousands of OneCoin members attended Coin Rush.
During the event, GREENWOOD introduced IGNATOVA to the crowd, stating in part: “This is the creator, the mastermind, the founder of cryptocurrency, of OneCoin . . . Now, this will be the biggest welcoming on stage that we’ve ever done in history.”
Then, to the tune of Alicia Keys’s “Girl on Fire,” and surrounded by actual onstage fireworks, IGNATOVA strode onto the Wembley Arena stage wearing a red ball gown. She proceeded to repeatedly and favorably compare her fraudulent cryptocurrency to Bitcoin, stating, among other things, “OneCoin . . . is supposed to be the Bitcoin killer” and “In two years, nobody will speak about Bitcoin anymore.”
On July 4, 2015, a federal holiday commemorating the independence of the United States, IGNATOVA announced the official opening of the United States market for OneCoin.
In early July 2015, GREENWOOD sent IGNATOVA an email stating in part, “I thought this could go out tonight, problem is I don’t have the access to send out to the members,” and attaching a document which announced a July 4, 2015, online webinar hosted by IGNATOVA and others to mark the official opening of the United States market for OneCoin.
Thereafter, on July 4, 2015, IGNATOVA participated in an online webinar, later posted to YouTube.com, in which IGNATOVA announced the official opening of the United States market for OneCoin.
During the webinar, IGNATOVA said, among other things, “[I]f we want to go and catch Bitcoin, we never can do this without being strong in the U.S. and without being part of the community. So, um, this is actually why I am so excited about the U.S. as the market. It’s something that is about prestige. It’s a huge market. And, um, it is, I think, a place of innovation, of Wall Street, a place where we have to be if we want to be big.”
Many victims in the United States invested in fraudulent OneCoin cryptocurrency packages, including residents of the Southern District of New York.
GREENWOOD was arrested at his residence on the island of Koh Samui, Thailand, in July 2018, and was extradited to the United States to face fraud and money laundering charges in October 2018. GREENWOOD has been detained since his arrest in July 2018.
On October 12, 2017, IGNATOVA was charged with OneCoin-related fraud and money laundering charges in the United States District Court for the Southern District of New York and a federal warrant was issued for her arrest.
The last indication of Ignatova’s whereabouts: $100,000 reward for information leading to IGNATOVA’S arrest.
On October 25, 2017, IGNATOVA traveled on a commercial flight from Sofia, Bulgaria, to Athens, Greece, and has not been seen publicly since. IGNATOVA was added to the FBI’s Top Ten Most Wanted List in June 2022. The FBI is offering a $100,000 reward for information leading to IGNATOVA’s arrest.
* * *
GREENWOOD, 45, a citizen of Sweden and the United Kingdom, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum potential sentence of 20 years in prison, one count of wire fraud, which carries a maximum potential sentence of 20 years in prison, and one count of conspiracy to commit money laundering, which carries a maximum potential sentence of 20 years in prison.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendant will be determined by a judge. Sentencing before Judge Ramos is scheduled for April 5, 2023.
Mr. Williams praised the outstanding investigative work of the Internal Revenue Service-Criminal Investigation and the Federal Bureau of Investigation, which jointly conducted this investigation with Special Agents from the U.S. Attorney’s Office. Mr. Williams also thanked the Royal Thai Police for their assistance in the arrest of GREENWOOD.
$100,000 REWARD FOR INFORMATION LEADING TO FUGITVE IGNATOVA’S ARREST
If you have any information about IGNATOVA’s whereabouts, please contact your local FBI office or the nearest American Embassy or Consulate. Tips can be reported anonymously and can also be reported online at tips.fbi.gov.
The case is being prosecuted by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Christopher J. DiMase, Nicholas Folly, Juliana N. Murray, and Kevin Mead, and Special Assistant U.S. Attorney Julieta V. Lozano of the New York County District Attorney’s Office, are in charge of the prosecution.
TWO TENNESSEEANS CHARGED IN MANHATTAN FEDERAL COURT WITH VIOLATING THE FREEDOM OF ACCESS TO CLINIC ENTRANCES ACT in New York and Multiple States,
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WPCNR FBI WIRE. From the Federal Bureau of Investigation. December 22, 2022:
Damian Williams, the United States Attorney for the Southern District of New York, and Michael J. Driscoll, the Assistant Director in Charge of the New York Office of the Federal Bureau of Investigation (“FBI”), announced today the unsealing of an Indictment charging BEVELYN BEATTY WILLIAMS and EDMEE CHAVANNES (together, the “Defendants”) with violating the Freedom of Access to Clinic Entrances Act (the “FACE Act”) and conspiring to do the same in connection with a multi-year campaign to interfere with individuals seeking to obtain and provide lawful reproductive health services in New York and in several other states.
WILLIAMS and CHAVANNES surrendered last Friday and will be presented in the United States District Court for the Eastern District of Tennessee. The case is assigned to U.S. District Judge Jennifer L. Rochon.
U.S. Attorney Damian Williams said: “As alleged, the defendants repeatedly attempted — including by using threats, and on at least one occasion, force — to prevent individuals from accessing their legal right to reproductive health services. This Office will remain committed to ensuring that healthcare facilities, their staff, and those seeking to obtain reproductive health services can continue to do so without unlawful interference.”
FBI Assistant District in Charge Michael J. Driscoll said:
“As we allege today, Ms. Williams and Ms. Chavannes violated the FACE Act by willfully interfering with individuals seeking to obtain or provide lawful reproductive health services. In one instance, Ms. Williams injured a health-center employee while obstructing access to the reproductive health center. The FBI will continue to investigate these types of allegations to ensure individuals who seek legal reproductive health services may do so without fear or intimidation.”
According to the allegations in the Indictment unsealed today in Manhattan federal court:[1]
From at least in or about 2019 up to and including at least in or about 2022, WILLIAMS and CHAVANNES agreed to and did use unlawful means — including force, threats of force, and physical obstruction — to injure, intimidate, and interfere with individuals because those individuals were seeking to obtain lawful reproductive health services or were providing such services.
As part of that agreement, on or about June 19, 2020, and June 20, 2020, WILLIAMS and CHAVANNES threatened and used force against patients and staff members at a reproductive health center located in lower Manhattan (the “Health Center”), and blocked patients and staff members from accessing the Health Center.
In one instance, WILLIAMS pressed her body against the door of the Health Center’s patient entrance and refused to move, preventing a Health Center volunteer from entering the Health Center. As a Health Center staff member (“Victim-1”) attempted to open the door for the volunteer, WILLIAMS purposefully leaned against the door, crushing Victim-1’s hand. Victim-1 yelled, “She’s crushing my hand,” but WILLIAMS remained against the door, trapping Victim-1’s hand and injuring it.
At various times on June 19 and 20, 2020, WILLIAMS and CHAVANNES stood directly in front of the Health Center entrances. WILLIAMS and CHAVANNES initially blocked the main entrance used by patients, causing the Health Center to have to divert patients to enter through the staff entrance.
WILLIAMS and CHAVANNES responded by moving in front of the staff entrance and directing others to do so as well. In addition, on or about June 19, 2020, CHAVANNES threatened Victim-1 by leaning her body toward Victim-1 at close range, forcing Victim-1 against metal barricades, while yelling “do not touch me” within inches of Victim-1’s face.
WILLIAMS and CHAVANNES livestreamed some of their conduct on June 19 and 20, 2020, on a social media account. On the livestream on June 19, 2020, WILLIAMS stated, in part,
“This is going to be a wonderful day. We are going to terrorize this place. And I want the manager to hear me say that. We are going to terrorize this place. More people are coming.”
The following day, WILLIAMS stated, in part, “We gonna stand here and we ain’t moving. We not moving. We’re standing here, so I guess no women will be coming in for abortions today. It’s a warzone.”
In addition to the defendants’ conduct in Manhattan, New York, WILLIAMS and CHAVANNES’ unlawful agreement to use prohibited means to injure, intimidate, and interfere with individuals because those individuals were seeking to obtain or provide reproductive health services has extended to other locations, including Florida, Tennessee, Georgia, and Brooklyn, New York.
For example, in January 2022, WILLIAMS and CHAVANNES travelled to and were present outside a health center in Fort Myers, Florida, where they directed other individuals to block health center entrances.
In addition, in July 2022, WILLIAMS and CHAVANNES blocked patient access to a health center in Atlanta, Georgia, by standing inside the center’s vestibule and yelling threatening comments at individuals believed to be health center patients.
* * *
WILLIAMS, 31, and CHAVANNES, 41, both of Ooltewah, Tennessee, are charged with conspiracy to violate the FACE Act, which carries a maximum sentence of five years in prison.
In addition, WILLIAMS is charged with violating the FACE Act through force, threats of force, and physical obstruction, resulting in bodily harm, which carries a maximum sentence of 10 years in prison. CHAVANNES is charged with violating the FACE Act through threats of force and physical obstruction, which carries a maximum sentence of one year in prison.
The maximum potential sentences are prescribed by Congress and are provided here for informational purposes only, as the sentencing of the defendants will be determined by a judge.
Mr. Williams praised the outstanding investigative work of the FBI.
The prosecution of this case is being handled by the Office’s Civil Rights Unit in the Criminal Division. Assistant U.S. Attorney Jamie Bagliebter is in charge of the prosecution.
The charges contained in the Indictment are merely accusations, and the defendants are presumed innocent unless and until proven guilty.
THE WHITE PLAINS GALLERIA WILL CLOSE IN MARCH, OWNERS SAY. WHITE PLAINS FIRST MALL WILL TURN INTO ANOTHER “MIXED USED” DEVELOPMENT
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PLANNING BOARD MEETS ON 100-HOME FARRELL ESTATES RIDGEWAY PROJECT FOR 35 MINUTES, FARRELL SPOKESMAN ASSURES BOARD THEY HAVE CONSIDERED THE WATER ISSUES HISTORY OF THE PROPERTY.
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WPCNR PLANNING PRESS. By John F. Bailey. December 21, 2022 Updated 3 PM EST with model home renderings proposed:
The White Plains Planning Board held a brief 35 minute question and answer period, on Farrell Estates, the new 100 luxury,upscale,home subdivision planned by Farrell Building Company of Bridgehampton .
Three members asked questions of a Farrell Estates spokesman last night .
The first question concerned the tour on the rain soaked property in response to concerns about heavy flooding last Friday on a part of the property. Diego Villareale, engineer speaking for Farrell Building Company, assured the Planning Board member that Farrell had taken tests on the property and in some instances allowed for placing some of the 100 homes planned for the site on higher ground, to wit:
Planning Commissioner Christopher Gomez at the close of the questioning period last night, encouraged White Plains citizens to send their views on the project to the Planning Department so the questions could be addressed in the next work session of the Planning Board January 9, when city staff and the Farrell representatives would again appear to answer questions on the site. No site plan was shown on the telecast of the meeting.
I do have this site plan that was shown at a Gedney Association meeting last spring. Note the faint outline of the homes within the white blocks below, those are where homes are planned to be positioned.
Mr. Gomez said the entire Farrell project application was on view at the Planning Department website on www.cityofwhiteplains.com
However, an overall color edition of the site plan showing the positioning of all the homes after it made a brief appearance when I first started to search to the site, could not be located for me to photograph it. It just seemed to disappear. That overall site plan showing positioning of the 100 new homes on the property could not be located by this reporter again. I am sure it is simply due to my novice ability to navigate the sophisticated city website. And citizens going to the site may fare better than I in finding the disappearing site plan.
The navigation and responsiveness of the loaded site plan on the Planning Department Projects and Proposals page is sluggish and for a tech-challenged reporter it is hard to know what key to press to view a page and response time is slow.
A comment by another Planning Board asked if minority contractors and Westchester contractors would be employed in the construction. The spokes person said Farrell Building has its own construction company, and he did not know the the answer to that question, saying the company hoped to complete the project in 2 years. (That would mean 50 homes a year.)
The Site Plan submission shows renderings of the styles of homes Farrell Building Company proposes to build on the site. These renderings are on the City of White Plains website.
RECORD HOMELESS IN NYC
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Latest Data Show October Set New Dismal Record for the Number of New Yorkers in the Main Shelter System as City Fails to Provide Affordable Housing
WPCNR STREET COPY. From the Coalition for the Homeless. December 21, 2022:
Newly released data, published pursuant to Local Law 37, show that homelessness in New York City is setting new, tragic records: The average number of people sleeping each night in the City’s main shelter systems – a figure that has been tracked by the Coalition for the Homeless since 1983 – hit a new all-time high of 65,633 in October.
The number includes homeless families and single adults sleeping in shelters under the Department of Homeless Services and the Department of Housing Preservation and Development.
The true cause of this sad milestone is the City’s failure to create affordable housing for those who need it most, compounded by needless bureaucratic delays that prevent many shelter residents from accessing the precious little housing that does exist.
Mayor Adams has focused on sweeping unsheltered homeless people out of sight, but has failed to give those without homes the stable housing they need. This crisis is driven by one thing, pure and simple: the lack of affordable housing in New York City. The Mayor’s ‘goal’ is creating 500,000 units of housing over the next 10 years, but we anxiously await the details of how those units will be targeted to those most in need. Tens of thousands of homeless New Yorkers need housing right now.
If Mayor Adams is serious about bringing down the shelter census and reducing homelessness in our city, he will commit to financing at least 6,000 apartments per year for homeless households and 6,000 for those with extremely low incomes. It’s time to end this crisis once and for all,” said Jacquelyn Simone, Policy Director with the Coalition for the Homeless.
300 MOTORISTS “SNAPPED” IN THE ACT OF PASSING STOPPED SCHOOL BUSES IN SOMERS SCHOOL DISTRICT BY BUSPATROL CAMS.
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Westchester only county in the New York region that has not approved such a program.
WPCNR SCHOOL DAYS. From BusPatrol. December 21, 2022:
BusPatrol and the Somers Central School District today released new data showing nearly 300 motorists that illegally passed a stopped school buses over a two-month period.
BusPatrol and the school district also released several videos of close encounters, providing the public a firsthand look into the dangerous driving behavior that routinely endangers young children when getting on and off a school bus. The footage was captured using cameras that were installed on stop-arms affixed to 59 school buses.
The school district obtained the data through a pilot program with BusPatrol, the leading stop-arm enforcement technology provider in North America.
Jean Souliere, CEO and Founder of BusPatrol, said: “These illegal passings are extremely dangerous and demonstrate the need for sensible photo enforcement on our roads. Westchester should follow the lead of other counties and pass a school bus safety program that gives schools and law enforcement the tools they need to keep our kids safe.”
“The BusPatrol program highlights a county-wide problem involving motorists running the red lights and stop arms on school buses,” said Somers schools Assistant Director of Transportation, Gerard Esposito. “In Somers we feel fortunate to have a program in place that deters motorists from putting our children in danger.”
From August through October, school buses equipped with AI-powered stop-arm cameras recorded a total of 280 illegal passings. This equates to 4.7 stop-arm violations per bus per day and 7.4 violations per weekday, or 0.1 violations per bus per weekday. The pilot data represents the clearest example to date that this type of illegally activity on the roads goes unreported and unenforced on a regular basis.
Westchester is the only county in the New York City region that has not authorized a school bus safety program. As a result, school districts and police departments across the county are denied the opportunity to utilize advanced photo enforcement technology to catch lawbreakers and issue citations to motorists who illegally pass a stopped school bus.
Meanwhile, neighboring suburban counties including Rockland, Dutchess, Putnam, as well as Suffolk County and several municipalities in Nassau County on Long Island, have all approved bus safety programs.
According to the Governor’s Traffic Safety Committee, stopped school buses are passed illegally an estimated 50,000 times per school day.
In New York State, it is illegal to pass a stopped school bus when the large red visual sign is in operation. Flashing lights mean the bus is picking up or discharging students. All motorists are required to stop whether approaching a stopped school bus from the front or overtaking it from the rear. This applies whenever their visual signal is in operation on any public highway, street, or private road.
Effective August 19, 2019, the new school bus camera law in New York authorizes school districts and municipalities to use stop-arm cameras on school buses to hold vehicle owners responsible for their cars passing a stopped school bus. This program allows a school district to equip school buses with stop-arm cameras designed to capture images of vehicles illegally passing stopped buses. The images are then transmitted to the municipality and used to identify the owners of vehicles and to send notices of liability to the owners. Tickets given by these cameras can result in fines of $250 for a first violation up to $300 for each violation in an 18-month period. The owners may then pay a fine or contest their liability.
FORMER WALL STREET TRADER CONVICTED OF FRAUD IN PRECIOUS METALS SPOOFING SCHEME. JPMORGAN PAYS $920 MILLION IN PENALTIES. 4 OTHERS PREVIOUSLY CONVICTED.
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WPCNR FBI WIRE. From the Federal Bureau of Investigation. December 21, 2022:
A federal jury in the Northern District of Illinois convicted a former trader at JPMorgan Chase and Credit Suisse today of fraud in connection with a spoofing scheme in the gold and silver futures markets.
According to court documents and evidence presented at trial, Christopher Jordan, 51, of Mountainside, New Jersey, was an executive director and trader on JPMorgan’s precious metals desk in New York from 2006 to 2009, and on Credit Suisse’s precious metals desk in New York in 2010.
Between 2008 and 2010, Jordan placed thousands of spoof orders, i.e., orders that he intended to cancel before execution, to drive prices in a direction more favorable to orders he intended to execute on the opposite side of the market.
Jordan engaged in this deceptive spoofing strategy while trading gold and silver futures contracts on the Commodity Exchange (COMEX), which is a commodities exchange operated by the CME Group. These deceptive orders were intended to inject false and misleading information about the genuine supply and demand for gold and silver futures contracts into the markets.
Jordan was convicted of wire fraud affecting a financial institution. He is scheduled to be sentenced at a later date and faces a maximum penalty of 30 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
Four other former JPMorgan precious metals traders were previously convicted in related cases.
In August 2022, Gregg Smith and Michael Nowak were convicted after trial in the Northern District of Illinois of wire fraud affecting a financial institution, commodities fraud, attempted price manipulation, and spoofing.
In October 2018, John Edmonds pleaded guilty in the District of Connecticut to one count of commodities fraud and one count of conspiracy to commit wire fraud, commodities fraud, price manipulation, and spoofing.
In August 2019, Christian Trunz pleaded guilty in the Eastern District of New York to one count of conspiracy to engage in spoofing and one count of spoofing. Smith, Nowak, Edmonds, and Trunz are awaiting sentencing.
In September 2020, JPMorgan admitted to committing wire fraud in connection with (1) unlawful trading in the markets for precious metals futures contracts and (2) unlawful trading in the markets for U.S. Treasury futures contracts and in the secondary (cash) market for U.S. Treasury notes and bonds.
JPMorgan entered into a three-year deferred prosecution agreement pursuant to which it paid more than $920 million in criminal monetary penalties, criminal disgorgement, and victim compensation, with parallel resolutions by the Commodity Futures Trading Commission and the Securities Exchange Commission announced on the same day.
Assistant Attorney General Kenneth A. Polite, Jr. of the Justice Department’s Criminal Division and Assistant Director Luis Quesada of the FBI’s Criminal Investigative Division made the announcement.
The FBI New York Field Office investigated the case.
Trial Attorneys Matthew Sullivan, Lucy Jennings, and Christopher Fenton of the Criminal Division’s Fraud Section are prosecuting the case.
Individuals who believe that they may be a victim in this case should visit the Fraud Section’s Victim Witness website at https://www.justice.gov/criminal-vns/case/jpmorgan-chase-co-deferred-prosecution-agreement for more information.
FORMER CEO PLEADS GUILTY TO DEFRAUDING HIS COMPANY OF MILLIONS OF DOLLARS
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WPCNR FBI WIRE. From the Federal Bureau of Investigation. December 20, 2022:
Damian Williams, the United States Attorney for the Southern District of New York, announced today that SUNI MUNSHANI, the former Chief Executive Officer of a Connecticut-based technology company (the “Victim Company”), pled guilty today in Manhattan federal court in connection with a scheme to defraud the Victim Company of millions of dollars. Pursuant to his plea agreement with the Government, MUNSHANI agreed to pay $10,485,043 in restitution to the Victim Company. District Judge Jed S. Rakoff accepted the defendant’s guilty plea.
U.S. Attorney Damian Williams said: “Not even a year into his appointment as CEO, Suni Munshani began betraying his employer’s trust and breaking the law, stealing millions of dollars to line his pockets. Company executives are given significant amounts of power, but today’s plea should send the message that this Office will be ready to act if an executive chooses to abuse that power.”
According to the allegations in the Superseding Information and other filings and statements made in court:
Between 2011 and 2019, SUNI MUNSHANI was the CEO of the Victim Company, which provided data security services to its clients.
Within six months of his appointment as CEO, MUNSHANI and others began an approximately nine-year scheme to defraud the Victim Company. During the scheme, MUNSHANI created an email account associated with a purported third-party contractor controlled by MUNSHANI and used that email account to correspond with the Victim Company and to obtain payments from the Victim Company totaling at least approximately $3 million dollars for services that were never provided to the Victim Company.
He also caused the Victim Company to issue a $3.5 million check for a purported tax liability, which check MUNSHANI then deposited into an unauthorized bank account created by MUNSHANI in the name of the Victim Company.
In addition, MUNSHANI defrauded the Victim Company through fraudulent licensing and reseller agreements between the Victim Company and two other companies (the “Licensing Company” and the “Reseller Company,” respectively).
Among other things, MUNSHANI instructed another individual to set up the Reseller Company “in the same way as [the Licensing Company],” and then helped create and submit fraudulent invoices from the Reseller Company to the Victim Company.
* * *
MUNSHANI, 61, of Easton, Connecticut, pled guilty to one count of conspiracy to commit wire fraud, which carries a maximum sentence of five years in prison.
The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation’s New York Office.
The prosecution of this case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorney Timothy V. Capozzi is in charge of the prosecution.