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Five ex-aides to Bernard Madoff, who prosecutors say have shown a “galling” lack of remorse since being convicted of fraud in March, are set to be sentenced next week for propelling the biggest Ponzi scheme in U.S. history, Bloomberg reported today. Jurors decided that the aides, who worked for Madoff for decades, deserve “significantly harsher” terms than the eight to 20 years recommended by the U.S. Probation Office. The defendants are seeking leniency, arguing that the jurors were misled by overzealous prosecutors. U.S. District Judge Laura Taylor Swain, who oversaw the five-month trial in Manhattan, is scheduled to hand down the sentences in separate hearings over three days beginning July 28. In addition, she also rejected requests to set aside their verdicts. The case is U.S. v. O’Hara, 10-cr-00228, U.S. District Court, Southern District of New York (Manhattan).

A former Shreveport, La., attorney has been sentenced to five years in prison and ordered to pay $1 million in restitution after pleading guilty to lying in bankruptcy court about his client knowing what he'd done with their money, KSLA reported yesterday. According to the U.S. District Attorney's Office for the Eastern District of Texas, James Ward Davis pleaded guilty last April to making a false statement in court during his bankruptcy proceeding. Davis operated and controlled Tower Hill Energy Co. LLC, which was purported to be in the business of acquiring oil, gas and mineral leases, interests, and royalties in north Louisiana. In February 2009, prosecutors say that Tower Hill entered into an agreement with Furie Petroleum. By way of the agreement, Tower Hill was obligated to acquire mineral rights on Furie’s behalf. Furie agreed to deposit $1 million to be used by Tower Hill “solely for the acquisition of Mineral Leases or purchase contracts/options to acquire Mineral Leases.” A client trust account for Davis’s law firm was used for escrow. Federal prosecutors say that Davis never told Furie or its representatives that he had transferred the money out of the Tower Hill escrow account and used the funds for personal and unrelated business purposes.

More than four years after Scott Rothstein’s $1 billion-plus Ponzi scheme came to light, a bitter turf war between representatives of his fraud victims and his creditors has finally been resolved, The Wall Street Journal reported yesterday. A recently reached settlement among federal prosecutors and bankruptcy officials should bring an end to a long-running fight over how to divvy up the fruits of Rothstein’s fraud among fraud victims and creditors of his now-defunct law firm. Ever since Rothstein’s arrest and the bankruptcy filing of his Florida law firm in late 2009, prosecutors and bankruptcy lawyers have bickered over whether his luxury cars, jewelry, cash, real estate and other assets were his personal property or property of the law firm. The settlement is subject to the approval of a bankruptcy and district judge.

A federal grand jury indicted TelexFree LLC co-founders and owners James Merrill and Carlos Wanzeler Wednesday on fraud charges tied to allegations that their company operated a massive pyramid scheme, The Wall Street Journal reported yesterday. The indictment expands upon the original criminal case against Merrill and Wanzeler, who were each charged in May with one count of conspiracy to commit wire fraud in connection with the alleged pyramid scheme, which prosecutors say caused total losses of more than $1 billion. The indictment also adds eight counts of wire fraud stemming from transfers of about $10 million in TelexFree funds to the two men's personal accounts. Each count carries a maximum sentence of 20 years.

A federal judge has slapped Girls Gone Wild founder Joe Francis with a daily fine of $5,000 until he returns two luxury cars that belong to the business, whose brand of videos was recently sold out of bankruptcy, The Washington Post reported yesterday. The fines, which start today, came after Hon. Sandra Klein did not buy Francis’s explanation for why he has not returned the 2007 Cadillac Escalade or 2012 Bentley Flying Spur. Francis had said in court papers that he was “powerless” to return the autos after a Mexican strip club owner took the vehicles. He is appealing the sanctions, and Judge Klein has set a July 31 hearing. Bankruptcy lawyers also won approval to bill Francis for the expensive legal headache he caused by visiting Girls Gone Wild’s former headquarters twice in May. The Girls Gone Wild brand went up for sale after the business’s operations filed for chapter 11 protection in February 2013.

JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon and board members won the dismissal of an investor lawsuit over $2.6 billion in penalties and settlements paid by the bank because of its relationship with convicted Ponzi scheme operator Bernard Madoff, Bloomberg reported yesterday. U.S. District Judge Paul Crotty threw out the suit, which sought damages on behalf of the bank based on claims that JPMorgan executives and directors turned a blind eye to Madoff’s fraud. The investors claimed that the defendants harmed the bank through breaches of fiduciary duty, securities law violations and waste of corporate assets. Judge Crotty said that the investors were not excused from the requirement that they demand that JPMorgan’s board pursue the legal claims before filing the suit. The case is Central Laborers’ Pension Fund v. Dimon, 14-cv-01041, U.S. District Court, Southern District of New York (Manhattan).

The federal judge who sentenced Bernard Madoff to 150 years in prison in 2009 ruled against an apparently phony request to disqualify prosecutors and dismiss criminal charges against the con man, Bloomberg News reported yesterday. U.S. Circuit Judge Denny Chin denied a rambling one-page motion brought in Madoff’s name by a federal convict who’s filed hundreds of frivolous lawsuits in U.S. courts, including many claiming that the government used mind control against him. The case is U.S. v. Madoff , 09-cr-00213, U.S. District Court, Southern District of New York (Manhattan).

Former Jefferies & Co. managing director Jesse Litvak, the only person convicted of fraud related to a $20 billion government bail-out program, may spend almost a decade in prison for lying to his customers about mortgage-backed securities, Bloomberg reported today. Litvak was found guilty by a jury in March of securities fraud and making false statements, as well as fraud connected to the U.S. Treasury Department’s Troubled Asset Relief Program. His conviction is the first in connection with the Public-Private Investment Program, an initiative that used TARP funds to spur investments in mortgage-backed securities after the 2008 financial crisis. Litvak is scheduled to be sentenced today by U.S. District Judge Janet Hall. Prosecutors have asked Judge Hall to send the former trader to federal prison for nine years and have him pay a $5 million fine. Litvak’s lawyers have asked the judge to sentence their client to no more than 14 months in prison, saying that his actions did not affect Jefferies customers’ investment decisions or their returns.

Barclays and Deutsche Bank helped more than a dozen hedge funds avoid paying more than $6 billion in taxes on securities trades through the use of structured financial products, The Washington Post reported yesterday. The report from the Senate Permanent Subcommittee on Investigations, due to be released today, arrives as the Obama administration is urging lawmakers to take action to stop American companies from reincorporating overseas in order to lower their tax bills, a practice known as tax inversion. The report shows that a number of firms are also relying on Wall Street banks to execute transactions in a way that allows them to circumvent federal taxes. At the heart of the report is the use of “basket options,” derivatives with a payoff that is tied to a pool of assets such as stocks, commodities or securities. The findings of the investigation will be the subject of a Senate panel hearing Tuesday, where senior executives from Barclays and Deutsche Bank are scheduled to testify. According to the report, the options structure also allowed hedge funds to borrow larger amounts of money to trade and exceed the federal leverage limits.

A Dallas woman was sentenced on Friday to one year and one day in federal prison for making false statements during her multiple bankruptcy filings, Dallas Morning News reported Friday. Estela Martinez, 54, had pleaded guilty in August 2013 to one count of making a false statement under penalty of perjury related to bankruptcy filings. Martinez’s prosecution is part of U.S. Attorney Sarah R. Saldaña‘s effort to crack down on bankruptcy fraud in the Northern District of Texas. Under the office’s Bankruptcy Fraud Initiative, seven people have been charged with various felony offenses since February 2013. Four of the defendants have entered guilty pleas, two of whom have been sentenced. Another defendant is scheduled for trial, and two others remain fugitives, the U.S. attorney’s office said. Martinez was unsuccessful the first time she filed for bankruptcy in 2009, and she filed five more times between then and 2012.