Fraud in the news

Yale dad uncovers college admissions scandal

You’ve already read about the greatest college admissions scandal in U.S. history. The stories of celebrities and other wealthy parents allegedly bribing college admissions officials and coaches to get their children into top-tier schools hit the news in March. According to the March 15 Texas Lawyer article by Janet Levaux, “How a Securities Fraud Case Uncovered the College Admissions Scam,” the man who tipped off authorities was under investigation by the Securities and Exchange Commission (SEC) for an unrelated securities fraud matter involving a pump-and-dump scheme with drug stocks.

Morrie Tobin, a former Yale student, offered a juicy tip to federal authorities — in exchange for leniency on his securities fraud charge — about a women’s coach at the school who accepted bribes in exchange. Then Yale soccer coach Ruby Meredith had allegedly accepted bribes from Tobin to get one of his kids into Yale. Tobin then met with former soccer coach Ruby Meredith while wearing a wire.

Tobin eventually reached a plea deal with the SEC and wasn’t charged in the college admissions scandal. But he’s expected to be sentenced in the SEC fraud matter in June.

West Coast ATM skimmers arrested

According to the March 15 SFGate article by Emily Maher, “West Coast credit card skimming ring busted in Sacramento,” four people were arrested in what could be a large-scale ATM skimming operation. The skimmers are suspected of setting up cameras on ATM machines along the U.S. West Coast and into Arizona.

According to the article, the men allegedly set up pinhole cameras and skimming devices on ATM machines to read credit card numbers. About 40 victims have been identified. However, authorities believe the devices were installed in December of last year so many more might be affected. 

Flooring company pays millions in penalties

According to the March 12 CNN Business article by Nathaniel Meyersohn, “SEC charges Lumber Liquidators with fraud for hiding formaldehyde,” the giant floor company must pay $33 million in an investor scam. Lumber Liquidators was charged in 2015 for lying to investors about the levels of formaldehyde in its laminate flooring products. The charges were filed after a “60 Minutes” story broke about questionable amounts of chemicals in the company’s products. Lumber Liquidators denied the claims and lied to investors that it had met regulatory standards.

The U.S. Centers for Disease Control and Prevention has reported that formaldehyde in products can be a risk factor for types of cancer. According to the article, in 2018, the company paid $36 million to settle class-action lawsuits brought by customers who bought the laminate between 2009 and 2015.