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An Agoura Hills, Calif.-based real estate developer has agreed to plead guilty to federal charges for failing to disclose on a bankruptcy petition that he had earned nearly $2.3 million in income and for failing to report almost $6.9 million in income on his tax returns, according to a Justice Department press release. Mark Handel has agreed to plead guilty to a two-count information charging him with making a false statement in bankruptcy and subscribing to a false tax return. Both the information and Handel’s plea agreement were filed today in United States District Court. Handel has agreed to forfeit approximately $3,545,712, which represents the proceeds of the sale of real estate in Alameda County. Handel also has agreed to pay to the IRS approximately $1,450,070 in tax liabilities, which include civil fraud penalties. He is expected to enter a guilty plea in the coming weeks. According to his plea agreement, in April 2015, Handel filed a bankruptcy petition in Los Angeles in which he knowingly made false statements. Under penalty of perjury, Handel stated that he had no income from 2013 until April 2015. In fact, Handel earned approximately $2,263,221 in income from DTMM Construction Inc., his West Los Angeles-based real estate development company. Handel caused DTMM, which, according to court documents, stands for “Don’t Touch My Money,” to be registered in his wife’s name but used DTMM to deposit the profits from his own work as a real estate developer and to pay for his and his family’s living expenses.

A man who authorities say publicly admitted to manipulating trading on decentralized exchange Mango Markets and draining more than $110 million of cryptocurrency is now facing U.S. criminal and civil charges, the Wall Street Journal reported. The man, Avraham Eisenberg, a 27-year-old resident of Puerto Rico, made his first court appearance Thursday afternoon at the federal court in Manhattan after being arrested on Dec. 26 in San Juan, Puerto Rico, the Justice Department said. He faces charges of commodities fraud, commodities market manipulation and wire fraud in connection with what prosecutors said was manipulation of Mango Markets. Eisenberg remained in police custody on Thursday and will be arraigned Feb. 14, when he would be asked to enter a plea. Brian Klein, a lawyer representing Mr. Eisenberg and a partner at law firm Waymaker LLP, said they are trying to work out a bail package with the prosecutors. The Securities and Exchange Commission and the Commodity Futures Trading Commission filed parallel civil charges against Mr. Eisenberg last month. The CFTC, which regulates derivatives markets, said the enforcement action against Eisenberg was the first of its kind against an alleged manipulation scheme involving a decentralized exchange. Prosecutors in the Southern District of New York alleged that Eisenberg made about $110 million last October through a fraudulent scheme that manipulated the price of certain perpetual futures contracts on Mango Markets’ own crypto token, named MNGO. Eisenberg allegedly used an account he controlled on Mango Markets to sell a large amount of perpetual futures for MNGO tokens and used another account on the exchange to purchase those same futures. He allegedly artificially pumped up the price of MNGO on three different digital asset exchanges that Mango Markets used to determine the value of the derivative contracts. Eisenberg then used the higher value of his MNGO futures positions to borrow and withdraw about $110 million of various digital assets from Mango Markets that effectively drained the platform of most of the assets that had been deposited by other users, prosecutors said.

Last year was the worst on record for cryptocurrency heists, with hackers stealing as much as $3.8 billion, led by attackers linked to North Korea who netted more than ever before, a U.S.-based blockchain analytics firm said in a report on Wednesday, Reuters reported. The report by Chainalysis found hacking activity that "ebbed and flowed" throughout the year, with "huge spikes" in March and October. October was the biggest single month ever for cryptocurrency hacking, with $775.7 million stolen in 32 separate attacks, the report said. The cryptocurrency market floundered in 2022, as risk appetite diminished and various crypto firms collapsed. Investors were left with large losses and regulators stepped up calls for more consumer protection. At the time, Chainalysis and other firms confirmed to Reuters that North Korean-related accounts had lost millions of dollars in value. But that did not deter hackers. North Korea-linked hackers such as those in the cybercriminal syndicate Lazarus Group have been by far the most prolific cryptocurrency hackers, stealing an estimated $1.7 billion worth of in multiple attacks last year, the report said.

Former plaintiffs’ personal injury lawyer Thomas Vincent Girardi has been indicted by a federal grand jury for allegedly embezzling more than $15 million from several of his legal clients, the Justice Department announced yesterday in a press release. Girardi, who owned the downtown Los Angeles-based Girardi Keese law firm, is charged with five counts of wire fraud, a crime that carries a statutory maximum sentence of 20 years in federal prison. Girardi, a once-powerful figure in California’s legal community until creditors forced his law firm into bankruptcy in December 2020, is expected to appear on Monday, February 6 at the United States District Court for arraignment. The State Bar of California disbarred Girardi in July 2022. Also charged in the indictment unsealed today is Christopher Kazuo Kamon, who was residing in The Bahamas at the time of his November 2022 arrest on a federal criminal complaint. He remains in federal custody. Kamon was the controller and chief financial officer of Girardi Keese from 2004 until December 2020. In this role, Kamon oversaw the law firm’s financial affairs, supervised its accounting department, and oversaw paying the firm’s expenses.

The U.S. government may have awarded roughly $5.4 billion in coronavirus aid to small businesses with potentially ineligible Social Security numbers, offering the latest indication that Washington, D.C.’s haste earlier in the pandemic opened the door for widespread waste, fraud and abuse, the Washington Post reported. The top watchdog overseeing stimulus spending — called the Pandemic Response Accountability Committee, or PRAC — offered the estimate in an alert issued Monday and shared early with The Washington Post. It came as House Republicans prepared to hold their first hearing this week to study the roughly $5 trillion in federal stimulus aid approved since spring 2020. The suspected wave of grift targeted two of the government’s most generous emergency initiatives: the Paycheck Protection Program, known as PPP, and the Economic Injury Disaster Loan, dubbed EIDL. Started under President Donald Trump — and managed by the beleaguered Small Business Administration — the roughly $1 trillion in loans and grants aimed to help cash-strapped companies stay afloat financially during the worst economic crisis since the Great Depression. But the money also served as a wellspring for criminal activity, as malicious actors took advantage of SBA and its poor oversight to bilk Washington out of seemingly massive sums. In the latest example, the PRAC found that the SBA failed to prevent a wave of applications from collecting federal money using suspect Social Security numbers. Studying more than 33 million applicants, the PRAC uncovered more than 221,000 ineligible Social Security numbers on requests for small-business aid. That included thousands of cases where the number was “not issued” by the government, for example, or it did not match the correct name and birth information. More than a quarter of those applications, using nearly 70,000 suspect Social Security numbers, were still approved between April 2020 and October 2022 despite the questionable data — and the government loaned those applicants about $5.4 billion, the watchdog found.

Unemployment fraud from pandemic jobless benefits may have topped $60 billion, according to a new report from the U.S. Government Accountability Office (GAO), The Hill reported. The federal watchdog said the Labor Department reported fraud estimates of about $8.5 billion for regular unemployment insurance programs in 2021. However, the government created four new unemployment programs during the COVID-19 pandemic aimed at alleviating the toll on workers. The GAO estimated that if the rate of fraud were extrapolated to total spending across all unemployment insurance programs during the pandemic, the fraud total would come out to more than $60 billion. The federal government paid out around $878 billion in unemployment insurance benefits between April 2020 and September 2022, according to Labor Department statistics. The report notes that unemployment insurance programs have long had integrity issues, and the GAO recommended that the Labor Department come up with an anti-fraud strategy based on guidance from the watchdog. The GAO said in the report that the department “partially” agreed with the recommendation and said it plans to address it.

The U.S. Supreme Court yesterday turned away appeals by two former Deutsche Bank AG commodities traders convicted of manipulating precious metals prices by placing "spoof" orders, Reuters reported. The court denied petitions by James Vorley and Cedric Chanu, who were each sentenced to just over a year in prison after being found guilty of wire fraud for spoofing, or placing orders with the intent to cancel them before trades are executed. The pair were convicted in 2020 for carrying out what prosecutors said was a yearslong spoofing scheme between 2008 and 2013. Their trades created a false sense of supply and demand, and induced other traders to make trades they would otherwise not have made, prosecutors said. On appeal, Vorley and Chanu argued they had not made the kind of explicit false statements targeted by wire-fraud law. The U.S. Court of Appeals for the Seventh Circuit in Chicago upheld the convictions last July, saying that "spoofing of this kind falls under the wire fraud prohibition." The Biden administration had asked the justices to reject the appeals.