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FBI

FBI Continues Insider Trading Investigations Using Stable of Informants

By Danny Fenster
ticklethewire.com
 There’s apparently no shortage of snitches on Wall Street.

The FBI said Monday that it plans to continue investigating alleged insider trading using its current “stable of informants” for the next five years,  reports ValueWalk.com.

The FBI has been running “Perfect Hedge” since 2009,  an operation that has resulted in charges against numerous traders, executives and research consultants.

David Chaves, a FBI supervisory special agent, securities and commodities fraud investigations, said on Monday, ‘We have cooperators set up for years to come,” FBI agent David Chaves said Monday, according to the news website.

He said some of the witnesses included traders who were busted and are looking to get reduced sentences.

To date, 59  of the 64 people arrested have been convicted or pleaded guilty ,  according to ValueWalk.com.

To read more click here.

FBI Changes Mind; Will Keep La Crosse, Wisc. Office Open

By Allan Lengel
ticklethewire.com

The FBI has backed off a little on its plans and will keep open its La Crosse, Wisc. office, U.S. Sen. Herb Kohl announced Tuesday.

Kohl had been fighting to get the FBI’s plan to close half of its office in the western district of Wisconsin.

The original plan called for the closure of Kenosha, Wausau and La Crosse offices to save money.

“Local law enforcement officials convinced us that having an FBI presence in western Wisconsin is a crucial layer in their efforts to fight drug trafficking, gang violence and other serious criminal enterprises,” Kohl said in a statement. “While I support streamlining operations, we have to consider whether distance challenges in our state would compromise the FBI’s mission and risk neglecting some of our rural communities. I’m gratified that Director Mueller and Attorney General Holder kept an open mind to our concerns and reevaluated their plans.”

 

Ex-Detroit Treasurer Indicted for Taking Bribes in Case that Cost Pension Funds $84 Million

By Allan Lengel
ticklethewire.com

DETROIT — In this cash-strapped city on the brink of financial collapse, seeing public corruption run wild is tough.

On Tuesday, the feds struck back, indicting the city’s former treasurer Jeffrey Beasley for taking bribes and kickbacks in return for approving more than $200 million in investments for two city of Detroit pension funds that lost $84 million from investments associated with the bribes.

Interestingly, Beasley is the former appointee and frat brother of ex-Detroit Mayor Kwame Kilpatrick, who is already under indictment for public corruption.

The indictment against Beasley alleges that he conspired with others to personally enrich himself and his co-conspirators between 2006 and 2008 by accepting bribes in the form of cash, travel, meals, golf clubs, drinks, gambling money, hotel stays, entertainment, Las Vegas concert tickets, massages, limousine service, private plane flights, and other things of value.

Authorities said that the bribes came from people who had  business before the General Retirement System and the Police and Fire Retirement.

The indictment alleges that Beasley personally received more than $100,000 in cash from people having business before the two pension funds. Another part of the scheme included demands by Beasley and others that individuals having business before the pension funds contribute tens of thousands of dollars to the Kilpatrick Civic Fund in order to receive approval for their investment requests.

“Employees of the City of Detroit are entitled to honest services from the trustees of their pension funds. We will prosecute public officials who abuse their positions of trust to personally enrich themselves at the expense of the people they were intended to serve,” said U.S. Attorney Barbara McQuade said in a statement.

Detroit’s top FBI agent Andrew Arena added:  “This is another example of a once trusted public official abusing their power for personal gain. The FBI remains dedicated to rooting out this type of corruption and reminding public officials they serve the citizens not themselves.”

 

Mich. Sen. Office Receives Letter with White Powder

By Danny Fenster
ticklethewire.com

The FBI announced on Monday that US Senator Carl Levin’s downtown Detroit  office was evacuated after an employee came across a letter filled with a “suspicious white powder,” reports the Detroit News. The powder was later determined to be harmless.

Levin’s office, located in the McNamara Federal Building, has since been reopened, according to the Detroit News. The senator was in Washington when the letter and the powder were discovered.

The Michigan senator is the latest across the nation to receive letters with the powder over the last week, though none have yet proved to be dangerous.

To read more click here.

 

Perrye Turner to Head FBI’s Louisville Office

Perrye Turner/fbi photo

By Allan Lengel
ticklethewire.com

The FBI’s Louisville office has a new person in charge.

The FBI announced Monday that Perrye K. Turner will head up the office as special agent in charge.

Turner most recently served as deputy assistant director of the Information Technology Engineering Division at FBI Headquarters, the agency said.

Turner started with the FBI in 1991 and was first assigned to the Birmingham Division, Huntsville Resident Agency, and in 1995, the New Orleans Division, Monroe Resident Agency, where he worked criminal investigative matters.

In 1999, he was promoted to supervisory special agent in the Criminal Investigation Division at FBI headquarters and worked in the Drug Section, Mexican/Criminal Syndicates Unit.

In 2001, he became a field supervisor and was assigned to the Jackson Division’s Criminal Enterprise Squad. While in Jackson, he later worked in the Field Intelligence Group in August 2004.

In August 2005, he was named assistant special agent in charge in the Memphis Division.

 

Michael Douglas Helping FBI Fight Insider Trading

By BEN PROTESS and AZAM AHMED
New York Times

Gordon Gekko is cooperating with the F.B.I.

No, there’s not another big-budget Oliver Stone follow-up to “Wall Street” in the works. Instead, Michael Douglas, who played the financier in the 1987 movie and the sequel, is now starring in a straight-to-television video for the Federal Bureau of Investigation meant to root out insider trading — the same crime that brought down the high-flying Mr. Gekko.

A one-minute spot that points out that illicit trading is, in fact, illegal might not seem a priority. But the new video — now showing on CNBC and Bloomberg Television — is part of the government’s broader initiative aimed at drawing cooperating witnesses and tipsters from Wall Street.

To read more click here.

FBI Says Billions in Financial Crime Restitution (AP)

DEA Agent Critical of Columnist’s Assertions on Penn State Scandal; Columnist Responds

Channel 13 News

 Charles Lutz is a retired DEA agent and Penn State University alum. His column is in response to a ticklethewire.com column by Ross Parker’s entitled: A Letter to My Son on Moral Decisions in Light of Penn State.
 
By Charles Lutz
For ticklethewire.com

 While I don’t disagree with Ross Parker’s advice to his son to always try to do the “right thing,” he has misstated the facts in making his case in his column “A letter to my Son on Moral Decisions in the Light of Penn State.”

For example, he says that once Joe Paterno, Athletic Director Tim Curley and Senior Vice President Gary Schultz learned of the alleged allegation by Graduate Assistant Mike McQueary that the three took no further action of any kind, and that Sandusky’s access to the children and the Penn State facilities were not restricted. That’s simply not true.

According to the Grand Jury Presentment, when Paterno learned of the incident from McQueary he reported it to his superiors, one of whom was in charge of the police department, which had jurisdiction for all crimes on campus. And when Curley and Shultz learned of the incident they banned Sandusky from bringing children into the locker room facilities, and reported the allegation to the Executive Director of Sandusky’s former charity, the Second Mile. It would have been fair for Ross to have said that he didn’t think what had been done was enough. But what was done was done was certainly more than nothing.

Further, Ross unfairly, in my opinion, accuses McQueary of doing nothing for nine years after making his report to Paterno, Curley and Schultz. But according to the Grand Jury Presentment, McQueary was informed of the actions taken against Sandusky, and that they had been approved by University President Graham Spanier. When McQueary was asked on the stand (at the preliminary hearing for the perjury charges against Curley and Schultz) why he didn’t go to the police, he said, “I thought I did (referring to Schultz).” I’m not sure what else a Graduate Assistant could have done.

Ross is quick to conclude, on his mistaken premise that Paterno, Curley and Schultz did nothing, that Sandusky was free to molest other children. But he fails to mention that during the more than two-year Grand Jury investigation of this allegation, these same facts, and allegations made by many other children, were well known to the Pennsylvania Attorney General (newly elected Governor), and the Commissioner of the Pennsylvania State Police, and that they did nothing to intervene on behalf of the children.

They could have indicted Sandusky on one felony count, exposed him, asked for legal restrictions on his activities with children, and superseded the indictment with the additional counts. But they chose not to do so. While they were quick to point the moral finger at Penn State officials, where were their moral compasses pointed? Perhaps Corbett didn’t want to rock the boat while he was running for Governor(?).

Parker’s Response

Ross Parker was chief of the criminal division in the U.S. Attorney’s Office in Detroit for 8 years and worked as an AUSA for 28 in that office. He is a regular columnist for ticklethewire.com.

By Ross Parker
ticklethewire.com

The fact is that exactly who did what and when in this alleged tragedy are hotly disputed subjects which will presumably be sorted out in court in the months ahead.

Neither of us were witnesses so each of us has relied on someone’s version. However, from what I can determine, the column’s assertion is accurate that Sandusky’s access was not restricted to children or to University facilities—except that about a month after the incident his keys to the locker room were taken away.

Coach Paterno did report to the appropriate officials two days after the incident. McQueary did report, in some fashion, to Coach Paterno and then to the Athletic Director and the Vice President for Finance and Business (who also oversaw the campus police), about ten days later when he was called to a meeting with them. Second Mile officials were told something about the incident, but Sandusky continued to be active in the organizationfor eight years.

If my brief and general rendition of the facts is unduly hard on the two coaches, who at least did do something, however limited, then I appreciate former Special Agent Lutz’s corrections of the record. But on the fundamental moral issue, the point is that, although everyone had to know that Sandusky continued to be actively involved with children, coaching, Second Mile activities, etc., no one acted to intervene beyond those initial discussions.

According to the Grand Jury Presentment, no one notified the University Police, the city or state police, or Child Protective Services. No one tried to protect or even identify the alleged child victim or to determine if there were others in need of counseling or protection.

OTHER STORIES OF INTEREST:

 

FBI Busts Sheriff on Conspiracy, Obstruction Charges

By Danny Fenster
ticklethewire.com

A Louisiana Sheriff was arrested on conspiracy, computer fraud, identity theft and obstruction charges, the FBI announced in a statement.

Sheriff Royce Edward Toney, 64, of Monroe, La., was arrested on Friday, according to the FBI. The indictment alleges that Toney and another man engaged in a conspiracy to illegally track the communications of a third party and that, once he learned the FBI sought to speak with him, he attempted to cover up the illegal tracking, according to the FBI.

From April to October of 2010 Toney and another man allegedly accessed protected computers without authorization and committed identity theft by using the AOL e-mail address and password of another persons. Toney is charged with obstruction both for reformatting the victim’s computer and for retaliating against a witness who spoke to the FBI in the investigation.