Tag Archives: fraud

Divorce Is Final, Says Court

Love hurts

The New York Court of Appeals ruled today that a Bernie Madoff victim can’t redefine the terms of his divorce on account of his losses to Madoff’s fraud.  Steven Simkin and Laura Blank, when married, invested $5.4 million in Madoff’s business together.  The terms of their 2006 divorce settlement totalling $13.5 million split all assets evenly.  However, while Mr. Simkin elected to retain his stake in Madoff’s business in the divorce, Blank took her half in cash.  Madoff turned himself in to police for perpetrating the largest Ponzi scheme in history just two years later.  Meaning that Simkin lost his millions, while Blank was none the worse.

Simkin sued Blank to essentially redo the divorce settlement, which eventually reached New York’s highest court.  His argument was that, since Madoff’s investment was fraudulent, he and Blank should split the losses evenly.  Today, the court decided against it, citing the finality of divorce and warning that allowing the resettlement would set a dangerous precedent for divorce settlements and other contracts.  While Simkin tried to argue that the Madoff account didn’t exist and so he shouldn’t be held accountable for his investment in it, the Court disagreed, saying that the account did exist, it was just illegal, and that Simkin could have taken out his money at any time, like his ex-wife did.  In other words, they called him a sore loser.

Lockheed Martin Settles with US Government for $16 Million

Jet

Lockheed Martin, a long-time defense contractor, was accused by the federal government of misrepresenting the cost of tools used to build the F-22 and F-35 fighter jets.  Allegedly, Lockheed subcontracted out some of the work and that subcontractor inflated the price of tools, a number that Lockheed passed on to the government despite knowing of its inaccuracy.  Last Friday, Lockheed agreed to pay the government $16 million to settle the suit.  The company denies any wrongdoing, claiming that they settled the suit “in an effort to close the matter in a timely manner.” Continue reading →

Renters Win $500,000 Settlement Against Landlord’s Scam

Rental scam

A landlord in Baltimore made quite a profit by faking property damage and suing his former renters for restitution.  That is, until Hong Park, a nonprofit legal aide looking into the matter for one of the renters, found the landlord’s claims to be a little fishy.  The landlord had provided supposed invoices from contractors detailing repairs to the property.  Park noted some suspicions about the invoices though — namely, that they didn’t have any company logos and that they were dated when collections began, not when the renter moved out.  The lawyer called up some of the referenced contractors and, lo and behold, all of the invoices were forged by the landlord.  Park sent the info on to the Maryland Attorney General’s office, and some subpoenas and a class-action lawsuit later, the owner of Ager Road Station Apartments will pay a $500,000 settlement to the former renters he swindled.  For anyone who’s dealt with a less-than-honorable landlord in the past, this settlement is a welcome victory.

Keep reading for tips on how to protect yourself from this kind of scam

Mets Pay $162 Million in Madoff Settlement

NY Mets

Mets fans are used to errors on the field, but not in the bank.  Fred Wilpon and Saul Katz, the owners of the New York Mets, have settled a lawsuit concerning their profits from the much-publicized Bernie Madoff Ponzi scheme, the biggest investment fraud ever conducted.  Irving Picard, the trustee hoping to recoup the investments lost in the Madoff case, had sued the Mets owners accusing them of “willful blindness”, or that they were aware of Madoff’s fraud, but ignored it because they were making money.  Early adopters of Ponzi schemes often make money in the time it takes to collapse.  The settlement today makes sure that those claims of willful blindness never go to court, claims which Picard thinks a jury would have found true.  Jury selection for this trial was set to occur this morning.  Luckily for the Mets, the owners settled for $162 million, nearly half of the $386 million they could have had to pay out.  This is in addition to the $83.3 million in profits the judge in this case had already ordered to be paid back.

It will be interesting to watch how the rest of the Madoff damages litigation pans out.  Despite the 74-year-old head honcho already convicted and in jail for a 150-year term, the recovery effort is still going strong, with Picard getting about $11 billion of the lost $17.3 billion returned.  It is a little late in the game now, but who knows.  Maybe all those rich people who trusted their money with a flimsy criminal will get their money back.  Also, maybe pigs will fly.  Here’s hoping!

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AT&T Offers to Settle over Limiting Unlimited Plans, Is Ignored

The limit does not exist

Via AP:  When smartphones first came on the market, telephone companies offered “unlimited” data plans cheaply in an effort to attract users.  Back then, there were so few smartphones, and even fewer users who used more than a couple of gigabytes of data, that advertising these unlimited plans would mean a great many people would buy them without using much data at all.  As smartphones became more ubiquitous and easier-to-use, though, the number of heavy users on unlimited plans rose to the point where they outnumbered regular users, and it was no longer profitable to sustain truly unlimited use.  Then, AT&T did something incredibly boneheaded: they started capping data use for certain unlimited plans.  In a textbook “do not do this” move, AT&T throttled the service for the top 5% of users, or slowed it down until phones were rendered nearly useless for anything other than calls and texts.  This varied by area, too.  The top 5% in New York City would be using a vastly different amount of data than the top 5% in Middle-of-Nowhere, Kansas.  Many customers subsequently sued AT&T for false advertising.  Rightfully so, because I can’t imagine “unlimited” to mean anything other than “not limited at all”.  AT&T has since announced that it will be throttling data at 3GBs/month for all unlimited users, not just the top 5%, which brought up yet another problem: limited users pay $30/month for 3GB of data, the same as so-called “unlimited” plans.  All in all, AT&T’s handling of the affair has been a major clusterwhoops.

Read about one customer’s crusade after the jump: