This morning Herbalife (NYSE: HLF) was charged criminally for paying bribes to Chinese officials. The action is related to criminal liability under FCPA (U.S. Foreign Corrupt Practices Act).
The company disclosed in an SEC filing today:
- Herbalife violated the books and records and internal controls provisions of the FCPA
- The company will pay $123 million as a settlement with the SEC and DOJ, and this amount has been included in current liabilities on the June 30, 2020 financial statemetns
- If the company doesn’t have any other violations for 3 years, this deferred charge will be dismissed
Herbalife disclosed in May that it had entered into a settlement agreement with the government. Today’s court proceedings make it official.
It’s fun to see pyramid schemes being held to account, even if it doesn’t happen often enough.
For years the owners of strip club Silk Exotic were trying to open a strip club in downtown Milwaukee. They knew there was a market for what they had to offer. There were already a handful of strip clubs in or close to downtown, but for some reason, they couldn’t get approved.
Eventually, the Silk owners won a jury verdict of more than $400,000 against the city, but that still didn’t get them their strip club. Milwaukee appealed the verdict and lost. When they added attorneys fees to the jury award, the city was on the hook for more than $968,000.
Milwaukee didn’t want to pay Silk the money, so Silk’s owners made them an offer: Let them open a strip club, and they’d forgo the jury award. Silk finally opened its strip club in downtown Milwaukee last year. Continue reading
When fraud happens within an organization’s accounting system, there is often a paper (or digital) trail left behind. It’s unavoidable, as there is a record of something related to the fraud, whether it is a legitimate invoice that was later adjusted, an account balance that was changed, or a fake employee who was added to the payroll system.
Frauds involving bribery and corruption are different. They happen almost completely outside the accounting system, so they often don’t leave a paper trail. Management instead must rely on tips or other vague clues to the existence of such a fraud scheme.
Bribery and corruption typically arise out of relationships between people, so in order to detect them, management must often be aware of the personal relationships between employees and outside parties. That is clearly a difficult task, and often nearly impossible. Continue reading
Patrick at Badger Blogger has audio of Michael McGee on the radio this morning. He said in part:
It’s the government trying to be nosey in somebody’s personal business. This is a family altercation. They wasn’t even… you know.. us trying to kill somebody anyway. And they got brother ___ . Come on. As much as he done did for people. The people just got to understand that, you know, it’s a family situation. And a young guy Pierre and his family. We never talked about hurtin’ him or killin’ him. I just want people to know that…that the government is tryin’ to use our language against us. Don’t even know what we talkin’ about.You know, I just want people to understand that…
And even on the federal side…entrapment, tryin’ to set me up, so I need people’s support. A lot of peopl… who put me in… Put up $100 we could get outta here.
He says “they” are creating hurdles for him to get out of jail. Yeah. That’s called BAIL.
And he sang a song about being soldiers. Wow. Impressive.
UPDATE: The Milwaukee Journal Sentinel is repearting that the “beat-down” is related to a theft of $4,800 cash and a semiautomatic gun from Little Stewart’s home. Stewart is one of the co-conspirators. McGee refers above to Pierre Crawley, a man who lived with Stewart for a period of time and was suspected of committing the burglary. It is alleged that McGee, Stewart, and Dimitrius Jackson were looking for the victim and discussed “quick-sanding” Crawley, as well as “peeling back his wig” and “sewing his cap together.
I was wondering something… How long can Michael McGee (Jackson) continue to collect his paycheck as alderman? Now that he ‘s been charged at both the federal and state levels, things look pretty grim for him. How long will it take to cut off the cashflow?
Badger Blogger did a great rundown of all the criminal activites, arrests, and inappropriate behavior from Junior McGee over the last year or two. It’s fascinating:
All of the other arrests weren.t enough. the perjury, the affair, the threatening to kill the mother of his illegitimate child while in a courtroom, the restraining orders, these weren.t enough.
The continued racial language on the public airwaves, the threat to hang Leon Todd and to punch State Senator Tim Carpenter and the open hatred against the homosexual community weren.t enough.
Making racially charged .jokes. and and the constant use of .the N-word. on the radio and in public, and threats to throw bricks through the windows of passing cars wasn.t enough.
Having two (that we know of) identities, including two social security numbers, and changing names to get out of paying a judgment against him after a car accident wasn.t enough.
Dodging the sheriffs department for several day when they tried to serve him with one of the restraining orders against him wasn.t enough.
Making harassing phone calls and giving out the personal phone numbers of political opponents and radio producers on a competing station, on their radio show wasn.t enough.
Using his .Respect Kampaign. to promote the Stop Snitchin. movement and calling the past District Attorney a .Dumb Ass. wasn.t enough.
But now, finally, the MJS Editorial Board thinks that there is reason enough for McGee to resign. Better late than never, I guess.
Great post, Patrick. Maybe this time we can get rid of him?
Today’s federal charges against Milwaukee alderman Michael McGee (Jackson) are becoming clearer as the media talks to witnesses.
WISN 12 News in Milwaukee interviewed Ajit Singh, who owns 2 gas stations in McGee’s district. He says he was forced to pay McGee/Jackson in order to help get his 24-hour operating licenses renewed. He had two licenses up for renewal, and McGee demanded $2,000 to help him get them renewed.
The evidence of the crimes allegedly includes recordings from an undercover agent wearing a wire, as well as recordings of phone conversations. When Singh handed McGee the money, an undercover agent was allegedly present.
State charges were filed today as well, but they are under seal as of right now. The charges are related to “substantial battery,” and it is believed that McGee threatened violence against someone in this shakedown scheme.
U.S. Attorney Steven Biskupic just announced some of the charges against Milwaukee alderman Michael McGee (Michael Jackson). The criminal complaint alleges extortion and bribery related to McGee’s duties as alderman.
The investigation began a year ago as business owners complained to the FBI about being asked to give McGee cash in exchange for favorable treatment on licensing matters. There were multiple store owners who complained, and federal and local authorities have been investigating, using undercover and electronic monitoring techniques.
It looks like there are more federal charges and more people to be indicted, but this is all under seal. It also looks like there will be state charges too, but those have not yet been made public.
UPDATE: The Milwaukee Journal Sentinel reports the following with regard to the potential state charges:
Police said this morning that McGee was arrested at 5:30 p.m. Monday. A clerk at the jail today declined to release McGee’s arrest and detention report for the booking saying that all information would be redacted from it.
A mug shot, however, shows that McGee was booked in on felony charges for:
- Substantial battery/intend bodily harm, party to a crime.
- Substantial battery-intend bodily harm.
Milwaukee alderman Michael McGee (Jackson) has been arrested again. No one is saying what he was arrested for, but the Milwaukee County District Attorney’s office has said that their office and the U.S. Attorney’s Office will release information tomorrow. McGee/Jackson is a criminal and an embarassment to our community. I can’t wait to see what he’s accused of doing this time.
UPDATE: The Milwaukee Journal Sentinel reports the following: Continue reading