Barry Minkow, the one-time Ponzi schemer who had claimed to be reformed and was helping the FBI nab white collar criminals, has agreed to plead guilty to insider trading of shares of the Miami-based homebuilder Lennar, according to Minkow’s lawyer.
Minkow, who is widely blamed for causing Lennar’s stock price to plunge nearly 20 percent on Jan. 9, 2009, could serve up to five years in prison if the plea deal goes through.
“We are in serious discussions and have reached an agreement in principal,” said Alvin Entin, Minkow’s lawyer. “We are working out the particulars.”
Minkow, who previously served seven years in prison on dozens of fraud and white-collar felony charges, began betting against Lennar stock, predicting that it would fall.
In January 2009, he put out a report bashing Lennar and describing the company “as a financial crime in progress.” Various news media picked up on the report, and the company’s stock price plunged 20 percent — or $500 million — in two days.
“We know fraud, and you’re just fraud,” Minkow said of Lennar in a 2009 YouTube video.
Lennar responded by denying all of the claims and filing suit against Minkow for libel and extortion.
Lennar declined to comment on Minkow’s plea agreement. The agreement is in a separate, criminal case. The civil matter is ongoing.
Read the complete story at miamiherald.com
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