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Showing posts from 2008

A New Year’s Message from a Convicted Felon: While you hope, criminals prey

My cousin Crazy Eddie Antar taught me that “people live on hope.” As white collar criminals, we preyed on your hopes and dreams by feeding you our spin and lies. Investors demand confident leadership and strong financial performance from company managements. They want to hear management exuding confidence about their company’s future business prospects. Eddie and I built an image of strong and confident leadership by promising investors a prosperous future backed up by our phony financial reports. As criminals, we considered the humanity of investors as a weakness to be exploited in the cold-blooded execution of our crimes. We measured our effectiveness by the comfort level of our victims. My cousin Eddie and I built walls of false integrity around us to gain the trust of our victims. We claimed that Crazy Eddie's accounting policies were "conservative." In addition, we gave huge sums of money to charity and were involved in many popular social causes in an effort to mak…

Is there really more white collar crime today? No.

Advice about white collar crime from a convicted felon: A bad economy causes many white collar crimes to float to the surface.Once, I asked a N.Y.C. police officer assigned to the harbor patrol, why are so many dead bodies are pulled out of the rivers around Manhattan every spring. He explained to me that many of these people did not actually die during the spring. Instead, many of these people really died during the previous winter.During the winter, if a person is killed and the dead body is dumped into the river or if a person commits suicide by jumping into the river from say a bridge, their bodies will sink to the bottom of the river because the water temperature is cold. When spring arrives, the water heats up and the dead bodies float to the top of the river surface. The harbor police then retrieve those bodies that are also known as “floaters.” Therefore, just because we find dead bodies in the spring, does not mean they died at that time. Instead, they probably died during th…

Barry Minkow Releases New Document to Show Microsemi Exec Peterson Lied

In a video posted on YouTube, a confident Barry Minkow, co-founder of the Fraud Discovery Institute, charged Microsemi Corp. (NASDAQ: MCSS) President and CEO and STEC Inc. (NASDAQ: STEC) Board Member James J. Peterson with "stock fraud."Minkow said that Peterson knowingly "lied" in a Microsemi press release, when Peterson "categorically" denied Minkow's background report last week that he falsified his academic credentials in reports filed with the Securities and Exchange Commission. Minkow said that Peterson "knew it was a lie. He did it to salvage the stock price."Minkow held in his hand a "Verification of Enrollment" that contained Peterson's birthday (information redacted), social security number (information redacted), and student identification number that was signed by the Brigham Young Registrar. The new document verified Minkow's background report that showed Peterson had falsified his academic credentials, stating…

Does Democratic Leadership Inaction on Rangel Render Promises of "Change" a "Bait and Switch" Tactic?

Corruption and unethical behavior by politicians is a cancer that slowly and deliberately destroys the integrity of our government institutions and ultimately threatens the stability of our Republic.

The Democratic Party which will control the Presidency, the Senate, and the House of Representatives has a unique opportunity to show that they are really serious about possible corruption and changing the way Washington does business.

However, they must start in their own backyard and immediately remove Harlem Congressman Charles B. Rangel from his position as House Ways and Means Chairman, until a full and thorough investigation of his finances is completed for possible tax and ethics violations.

Otherwise the Democrats are sending a clear message – anything goes for our friends and allies, especially powerful friends in Congress. Worst yet, inaction by the Democratic leadership on issues of possible corruption and unethical behavior will render President-elect Barack Obama's much …

Manian Resigns From STEC, A Day After Broadcom Fires Him For Phony Credentials

UpdatedThis evening, STEC Inc. (NASDAQ: STEC) announced that Vahid Manian resigned as a director of the company, a day after he was fired from Broadcom (NASDAQ: BRCM) for falsifying his educational background in reports filed with the Securities and Exchange Commission. In an 8-K report filed with the Securities and Exchange Commission, STEC disclosed:On December 4, 2008, STEC, Inc. (the “Company”) received notice from Vahid Manian of his resignation as a director of the Company to be effective as of the end of December 31, 2008. Mr. Manian is also a member of the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee. The Company has commenced a search for a replacement to fill the vacancy that will be created by Mr. Manian’s resignation.On Wednesday, December 3, 2008, Fraud Discovery Institute co-founder Barry Minkow released details of a background investigation showing that Broadcom Corp. Senior Vice President and STEC Inc. Board Member Vahid Man…

Broadcom Executive Fired Today For Phony Credentials, While Microsemi Executive Remains Under Scrutiny

Broadcom Executive Vahid Manian FiredBroadcom Corp. (NASDAQ: BRCM) fired Senior Vice President Vahid Manian after a background report issued by Barry Minkow, co-founder of the Fraud Discovery Institute, uncovered him using phony educational credentials in filings with the Securities and Exchange Commission. Broadcom simply issued a terse one-sentence statement saying:On December 3, 2008, the employment of Vahid Manian, Senior Vice President, Global Manufacturing Operations of Broadcom Corporation and an officer and/or director of various Broadcom subsidiaries, was terminated. A search has commenced to find his successor.Broadcom could have at least thanked my dear friend Barry Minkow for uncovering lies by its Senior Vice President that the company was incapable of finding. No surprise in their lack of gratitude.In my last blog post, I detailed how a background check by Minkow exposed that Broadcom Corp. Senior Vice President and STEC Inc. Board Member Vahid Manian did not receive a “…

Barry Minkow Reports More Corporate Scoundrels Misrepresenting Credentials

According to new background checks conducted by Barry Minkow, co-founder of the Fraud Discovery Institute, two more executives misrepresented their educational credentials in regulatory filings: Broadcom Corp. (NASDAQ: BRCM) Senior Vice President Vahid Manian and Microsemi Corporation (NASDAQ: MSCC) Chief Executive Officer James J. Peterson.Worst yet, both executives sit on the board of directors of STEC Inc. (NASDAQ: STEC). Therefore, two of six board members of STEC Inc. and two of four members of its audit committee used phony credentials in SEC filings, according to the Fraud Discovery Institute background reports.Vahid ManianAccording to the first background check, Broadcom Senior Vice President and STEC Board Member Vahid Manian did not receive a “B.S.E.E and an M.B.A from the University of California, Irvine” as claimed in a Broadcom proxy filing and an STEC proxy filing with the SEC.A Bloomberg News article by Ian King provides additional details:Broadcom Corp. Senior Vice Pre…

New York Democratic Party Leadership Takes Money from Same-Sex Marriage Supporters and Won't Deliver on Promises

Many politicians from both sides of the aisle emulate the same character traits as criminals. Criminals consider your humanity as a weakness to be exploited in the execution of their crimes. First, criminals try to raise your comfort level by bonding with you to gain your trust. After gaining your trust, criminals take your money based on false promises of hope. As the criminal CFO of Crazy Eddie, I sold many gullible investors on the hope of a prosperous future by using phony financial reports to raise their comfort level and trust.
Apparently, the same holds true with the New York Democratic Party leadership. They exploited the aspirations of gay rights supporters by selling them the hope of promptly moving to legalize same-sex marriage in return for campaign contributions to get party members elected. Now they are telling those same voters that swift action on same-sex marriage legislation may make them unelectable in the future. According to a New York Times article by Jeremy W. Pe…

Overstock.com: Rule 10b-5 Exposure from Disclosure Violations

In this blog post, I will detail how certain members of Overstock.com's (NASDAQ: OSTK) unprincipled management team conned investors into believing that the company's non-compliant EBITDA disclosures were in compliance with Securities and Exchange Commission Regulation G, governing non-GAAP disclosures. I believe that Overstock.com's non-compliant EBITDA disclosures that materially overstated the company's financial performance, together with other false and misleading representations by management, expose them to possible violations of anti-fraud Rule 10b-5. In my last blog post, I detailed how Overstock.com finally amended its financial reports to comply with SEC Regulation G, almost a year after it was notified by me of its violations. This blog was first in exposing how Overstock.com used a non-compliant EBITDA measure to overstate its financial performance from Q2 2007 to Q2 2008.Other bloggers, such as forensic accountant Tracy Coenen, NY Times columnist Floyd No…