Alleged $283M Institutional Investor Fraud Involving Biotech Companies Leads to Criminal Indictments

A federal grand jury has indicted two men for their alleged involvement in a nearly$230M institutional investor fraud scaminvolving biotech companies. G. Steven Burrill, the owner and CEO of Burrill & Company, and Marc Howard Berger are the two defendants named in the criminal indictment. Burrill is charged with 26 counts of wire fraud, one count of investment adviser fraud, and one count of tax evasion. Berger is charged with multiple accounts of aiding in preparing fraudulent tax returns.

根据刑事起诉，伯里尔（Burrill）发送了虚假和误导的信，以说服有限的合伙人将资本捐给基金。据称，他还向其控制的公司移交了数百万美元的不必要的管理费，并提交了所谓的欺诈性纳税申报表。

It was in March of last year that Burrill settled civil charges brought by the US Securities and Exchange Commission accusing him of taking funds from the Burrill Life Sciences Capital Fund III in order to maintain his expensive lifestyle and keep some of his other businesses in operation. The regulator claimed that Burrill took from the Fund III and pretended that these were management fees he was issuing to himself in advance. He then allegedly went on to spend the money on vacations, jewelry, private planes, and other expenses.

为了解决SEC的机构投资欺诈案，Burrill和他的Burrill Capital Management同意将47.85亿美元的投资者资金分配，并支付100万美元的罚款。他还同意永久禁止证券行业。bob200体育

Institutional investors were the ones who backed the fund. In 2015, one of the investors, a venture capital firm, sued Burrill and his Burrill & Co. investment firm, accusing him and others of embezzling over $17M from the fund and causing over $30M in investor losses. Also, that year, Ann Hanham, formerly a Burrill managing director, sued him, contending that $19.2M in unauthorized payments had been issued.

Burrill & Co had initially raised $283M for the Fund III, which started investing in companies, including pharmaceutical entities, in 2006. After looking into the fund’s books, investors removed Burrill as the fund manager last year.

Investment Fund Manager Ordered to Serve 12 Years in Prison Over $96M Ponzi Fraud

在其他机构投资欺诈新闻中，布莱恩·R·卡拉汉（Brian R. Callahan）在2014年的9600万美元庞氏骗局中对证券欺诈和电汇欺诈认罪，他已被判处12年徒刑和3年监bob200体育督释放。他还必须支付近6760万美元的赔偿金。

Court filings note that between 12/2006 and 2/2012, Callahan raised over $118M from at least 40 investors for four investment funds. He told them their money would go to securities such as hedge funds and mutual funds. Instead, he misappropriated almost $96M and ran a Ponzi scam.

Not only did Callahan divert millions of dollars to buy a 116-unit beachfront residency and resort in New York, but also, he commingled the investment funds’ monies, paid investors “redemptions” as part of his Ponzi scam, and funded his lavish lifestyle. He sent bogus account statements to investors to make it appear as if their investments were doing well.

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长岛投资基金经理因9600万美元的庞氏债被判处12年监禁, Justice.gov, September 15, 2017

Bay Area Defendants Charged In Alleged Multi-Million Dollar Investment Fraud And Tax Evasion Scheme，Justice.gov，2017年9月18日