Securities Cases: Petrobras Will Pay $2.95B in Class Action Case, Ex-Och Ziff Hedge Fund Executive is Indicted Over Investment Scam, and Former Banker is Accused of Defrauding Excel Bank of Millions of Dollars
Ex-Och Ziff Hedge Fund Executive Indicted in NY Over Alleged Africa Investment Fraud
A grand jury in Brooklyn, NY has indicted Michael Cohen, the ex-head of Och Ziff Capital Management’s European operations on fraud, conspiracy, and other criminal charges. According to prosecutors, Cohen hid a conflict of interest involving a mining company investment and defrauded an institutional client.
The ex-Och Ziff hedge fund executive and his former company are accused of making representations to a UK foundation that then agreed to invest up to $200M in a joint African venture in 2008. Cohen, who allegedly used the joint venture fund to purchase stock from someone who had borrowed money from him for a yacht, is accused of failing to disclose his own stake in the investment. Meantime, the person whom, CNBC reports, owed Cohen money, allegedly used funds from the stock purchase to pay him back $4M.
Cohen is accused of trying to conceal the investment scam by generating a bogus letter and making statements to the SEC, IRS, and FBI that were “materially false.”
Last year, the SEC filed charges against Cohen and another ex-Och Ziff official for engaging in a bribery scam to gain African business. The year before, Och-Ziff settled for over $200M allegations brought by the US Justice Department accusing the firm of making over $100M in bribes in exchange for African natural resource-related deals.
Ex-Missouri Banker Pleads Guilty to Defrauding Excel Bank
Shaun Hayes, an ex-banker, has pleaded guilty to criminal charges accusing him of defrauding Excel Bank of millions of dollars. Michael Litz, his business part, is also accused of defrauding the bank and will go on trial later this month.
Hayes was involved in getting Excel Bank in Sedalia, Missouri, to purchase loans that were delinquent from an LLC that belonged to him and Litz. Hayes is scheduled to be sentenced in April for bank fraud and misapplying over $10M in bank funds.
Petrobas Arrives at $2.95B US Class Action Settlement with Investors
In one of the largest securities class action settlements ever reached in the US, oil giant Petrobas has agreed to pay $2.95B while maintaining that it did not engage in any wrongdoing.
The Brazil-run oil company has been under fire over the last four years over allegations of kickbacks, including over $2B in bribes that purportedly involved Petrobas executives, politicians, and leading construction and engineering companies. The alleged mass corruption has been called Lava Jato or the Car Wash Scandal. Investors sued the oil giant in the wake of these allegations.
Just last week, the Securities and Exchange Commission of Brazil filed formal accusations against eight ex-Petrobas executives over potential irregularities involving the contracting process for drill ships.
At The SSEK Partners Group, our securities fraud lawyers are committed to helping investors in getting back their financial losses they’ve sustained due the negligence, carelessness, or the fraudulent actions of others. We have successfully gone up against big Wall Street banks on behalf of investors. Contact us today to explore your legal options.
Former Och Ziff hedge fund executive indicted for fraud in Africa investment scheme, prosecutor says, CNBC, January 3, 2018
Read the SEC Complaint in the Cohen Case (PDF)
Banker Shaun Hayes Pleads Guilty, Justice.Gov, January 3, 2018
Petrobras to pay $2.95 billion to settle U.S. corruption lawsuit, Reuters, January 3, 2018