Minkow Gets Five Years for Stock-Fraud Conspiracy, Must Pay $583 Million

[douglas9]

Source: Bloomberg

Barry Minkow, a convicted confidence man who started a fraud-detection firm, was sentenced to five years in prison for his role in a stock-manipulation scheme.

Minkow, 45, was also ordered today in Miami federal court to pay $583 million in restitution. U.S. District Judge Patricia Seitz gave Minkow, who pleaded guilty in March to conspiracy to commit securities fraud, 60 days to surrender so he can get his sons settled in school.

Prosecutors said Minkow made false and misleading statements about Miami homebuilder Lennar Corp. (LEN)’s financial condition to drive down the company’s share price. The U.S. said Minkow also abused his relationship with federal law enforcement agents to get non-public information about Lennar and traded on that information.

“His hubris is what caused this problem,” Minkow’s attorney, Alvin Entin, said today. “His narcissism is what caused this problem. He’s not going to make the same mistake a third time.” Minkow didn’t speak at the hearing except to answer the “yes, ma’am” to judge’s questions.

Read more: http://www.bloomberg.com/news/2011-07-21/fraud-detector-minkow-gets-five-years-in-prison-for-stock-fraud-conspiracy.html

[JHB]

1. In 1988 he was sentenced to 25 years for 57 counts of fraud and conspiracy...

...but only served 7.

He spent the time after he got out running a company the uncovered corporate fraud. Reformed? Or just "doing good deeds" to get his rep back?

From the OP article:

“His hubris is what caused this problem,” Minkow’s attorney, Alvin Entin, said today. “His narcissism is what caused this problem. He’s not going to make the same mistake a third time.” Minkow didn’t speak at the hearing except to answer the “yes, ma’am” to judge’s questions

I call BS on the assumption that "He’s not going to make the same mistake a third time." He's a con man. If he's ever given the chance (and he'll wheedle an opening somewhere), it's almost guaranteed he'll do it again.

Is there a derivatives market market for betting on bad behavior? I'm willing to make an investment that this guy won't stay clean after he gets out.

[PoliticAverse]

2. "He’s not going to make the same mistake a third time."

He means getting caught ?