7 ms·

> 1. Shkreli lost 100% of his original investors' money. Source? I hadn't heard that. http://fortune.com/2017/08/05/why-martin-shkreli-is-guilty-when-investor

by rb808 9y ago

> 1. Shkreli lost 100% of his original investors' money. Source? I hadn't heard that. http://fortune.com/2017/08/05/why-martin-shkreli-is-guilty-when-investors-didnt-lose/ http://fortune.com/2017/08/05/why-martin-shkreli-is-guilty-w...

mikeyouse 9y ago
From the SEC's original complaint: https://www.sec.gov/litigation/complaints/2015/comp-pr2015-282.pdf https://www.sec.gov/litigation/complaints/2015/comp-pr2015-2... > 44. On March 2, 2011 , Shkreli stated in e-mails to MSMB investors that "MSMB returned +4.24% in February 2011 " and had "returned +41.71 % since inception on 11/1/2009." In fact, by the end of February 2011, MSMB had virtually no assets. MSMB had suffered over $7 million in losses in its account at Executing Broker as the result of its trading in Company A on February 1, 2011. Even setting aside the losses at Executing Broker, the net asset value of MSMB's prime brokerage account and the cash balance in its bank account amounted to only about $58,500. > 45. Shkreli continued to send "performance estimates" until September 2012, when he informed the limited partners that through June 2012, MSMB had "returned +79.49% net of fees since inception on 11 /1/2009." At the end of June 2012, however, MSMB had no assets in its prime brokerage account or its bank account. He lost 100% of his investors' money and was creating fake financial statements to lie to them about his massive losses. Eventually, he used other people's money and huge gambles to recoup these losses. He also entered into fraudulent 'consulting agreements' with disgruntled investors from his hedge fund to make them whole using a different company's assets, essentially stealing from that company's shareholders. All of this is incredibly illegal.
- rb808 9y ago
  Agreed its illegal and could have gone to zero. His investors could easily have lost all their money, but they didn't. Theranos investors did. I guess its like Bernie Madoff's investors got most of their money back, but Citigroup investors lost 90%.
- onecooldev24 9y ago
  What about the fact, that he paid from his own shareholding of the company, and the company investors didn't end up paying for it. The bigger point every one is missing is, he got a 800% increase from the average sentence. That IS NOT FAIR!!
  - mikeyouse 9y ago
    He repaid investors in his hedge fund with millions of dollars in fraudulent consulting contracts from a different company that they weren't investors in. This is a breach of fiduciary duty at minimum and likely criminal fraud. He also repeatedly produced false financial statements to cover up his massive losses. He was convicted by a jury of his peers on Federal charges and was sentenced using the Federal Sentencing Guidelines which are universal across all cases. Shouting in all caps doesn't make something unfair...

by rb808 9y ago

mikeyouse 9y ago

From the SEC's original complaint: https://www.sec.gov/litigation/complaints/2015/comp-pr2015-282.pdf https://www.sec.gov/litigation/complaints/2015/comp-pr2015-2... > 44. On March 2, 2011 , Shkreli stated in e-mails to MSMB investors that "MSMB returned +4.24% in February 2011 " and had "returned +41.71 % since inception on 11/1/2009." In fact, by the end of February 2011, MSMB had virtually no assets. MSMB had suffered over $7 million in losses in its account at Executing Broker as the result of its trading in Company A on February 1, 2011. Even setting aside the losses at Executing Broker, the net asset value of MSMB's prime brokerage account and the cash balance in its bank account amounted to only about $58,500. > 45. Shkreli continued to send "performance estimates" until September 2012, when he informed the limited partners that through June 2012, MSMB had "returned +79.49% net of fees since inception on 11 /1/2009." At the end of June 2012, however, MSMB had no assets in its prime brokerage account or its bank account. He lost 100% of his investors' money and was creating fake financial statements to lie to them about his massive losses. Eventually, he used other people's money and huge gambles to recoup these losses. He also entered into fraudulent 'consulting agreements' with disgruntled investors from his hedge fund to make them whole using a different company's assets, essentially stealing from that company's shareholders. All of this is incredibly illegal.

rb808 9y ago
Agreed its illegal and could have gone to zero. His investors could easily have lost all their money, but they didn't. Theranos investors did. I guess its like Bernie Madoff's investors got most of their money back, but Citigroup investors lost 90%.
onecooldev24 9y ago
What about the fact, that he paid from his own shareholding of the company, and the company investors didn't end up paying for it. The bigger point every one is missing is, he got a 800% increase from the average sentence. That IS NOT FAIR!!
- mikeyouse 9y ago
  He repaid investors in his hedge fund with millions of dollars in fraudulent consulting contracts from a different company that they weren't investors in. This is a breach of fiduciary duty at minimum and likely criminal fraud. He also repeatedly produced false financial statements to cover up his massive losses. He was convicted by a jury of his peers on Federal charges and was sentenced using the Federal Sentencing Guidelines which are universal across all cases. Shouting in all caps doesn't make something unfair...