Page 112 - CL Armchair Case
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The SEC said Shkreli began losing money and lying to
investors from the time he began managing money. In his
mid-20s, he got nine investors to place $3 million with him
and at one point he had only $331.
Shkreli was charged with securities fraud and conspiracy.
Prosecutors said from 2009 to 2014, Shkreli lost some of his
hedge fund investors' money through bad trades, then
looted a pharmaceutical company where he was CEO for
$11 million to pay back his disgruntled clients.
Four years from 2011, before being arrested Shkreli and his
hedge fund were suspected of faking a takeover bid for a
then-publicly traded health-care company, SeraCare —
suspicions that were made known to federal authorities in
2012. He apparently repeatedly misrepresented his fund's
performance and the size of its assets under management
in an attempt to make it appear the fund was much bigger
than it actually was.
In the SeraCare matter, Shkreli made an offer in June 2011
to buy the company for $4.25 a share. "We strongly believe
that the Board of Directors should find our offer to be fair
and in the best interests of the Company's stockholders,"
Shkreli said in a letter sent to SeraCare's board.
