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22 December 2004 – LAWFUEL – Best for law news – Marcos Daniel Jimé…

22 December 2004 – LAWFUEL – Best for law news – Marcos Daniel Jiménez, United States Attorney for the Southern District of Florida; Michael S. Clemens, Special Agent in Charge, Federal Bureau of Investigation; Stephen M. Cutler, Director of Enforcement, United States Securities and Exchange Commission, Washington, D.C.; Dave Nelson, Regional Director, Securities and Exchange Commission, Miami, Florida; Don Saxon, Commissioner, Office of Financial Regulation, State of Florida; and Michael S. Reiter, Chief, Town of Palm Beach Police Department, announced today that defendant, Charles J. Kerns, Sr., was sentenced by United States District Court Judge Kenneth Marra, in Ft. Lauderdale, Florida, to a term of imprisonment of twenty-seven (27) years for his role in a wide-ranging securities fraud stock loan scheme spanning nearly four (4) years. Kerns, a former resident of Palm Beach, Florida, also was sentenced to a term of three (3) years of supervised release and ordered to pay restitution in the amount of $11,535,518. Kerns’ sentencing represents the final sentencing in this five (5) defendant prosecution, in which two (2) of the co-defendants were convicted of participating in a conspiracy to commit securities fraud in connection with a mutual fund “market timing” and “late trading” scheme. These two (2) other convictions are believed to represent the first federal court criminal convictions for mutual fund “market timing” and “late trading” in the nation.

On September 2, 2004, a federal jury in Fort Lauderdale found Kerns guilty on seventeen (17) counts of a nineteen (19) count Third Superseding Indictment. The jury found Kerns guilty of one (1) count of conspiring to commit securities and wire fraud, nine (9) counts of securities fraud, six (6) counts of wire fraud, and one (1) count of money laundering, in violation of Title 18, United States Code, Section 371, Title 15, United States Code, Section 78j(b), Title 18, United States Code, Section 1343, and Title 18, United States Code, Section 1957, respectively.

With Kerns’ conviction and sentencing, all of the defendants in this wide-ranging securities fraud prosecution have been convicted and sentenced. On June 23, 2004, co-defendant, Brett Dohner, pleaded guilty to one (1) count of conspiring to commit securities fraud and one (1) count of securities fraud in connection with the stock loan scheme. On July 27, 2004, co-defendant, Kautilya “Tony” Sharma, pleaded guilty to one (1) count of conspiring to commit securities fraud in connection with the mutual fund “market timing” and “late trading” scheme and one (1) count of
conspiring to sell unregistered securities. On July 28, 2004, the day after Sharma’s guilty plea, co-defendant, Neal Wadhwa, pleaded guilty to one (1) count of conspiring to commit securities fraud in connection with the mutual fund “market timing” and “late trading” scheme. The convictions of Sharma and Wadhwa are believed to represent the first federal court criminal convictions for mutual fund “market timing” and “late trading” in the nation. On August 16, 2004, co-defendant, Lewis Hodge, pleaded guilty to one (1) count of conspiring to commit securities fraud in connection with the stock loan scheme.

The four (4) co-defendants were sentenced recently. Sharma was sentenced to a term of five (5) years in prison. Wadhwa was sentenced to a term of six (6) months in prison. Both Hodge and Dohner were to terms of prison of one (1) year and one (1) day.

Mr. Jiménez commended the investigative efforts of the Federal Bureau of Investigation, United States Securities and Exchange Commission, Palm Beach Police Department, and State of Florida, Office of Financial Regulation. This case is being prosecuted by Assistant United States Attorney Emalyn H. Webber, Special Assistant United States Attorney James M. Fay, and Colleen Conry, Trial Attorney, Frauds Section, Criminal Division, United States Department of Justice.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls . Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on .

British MP George Galloway and his opponent the Daily Telegraph will leave no stone unturned to sort out what could be a spectacular libel case.