Government asking for help gathering evidence on Elgindy --- .
DJ IN THE MONEY: Elgindy Case Broadened With New Arraignment
March 26, 2003
By Carol S. Remond A Dow Jones Newswires Column
NEW YORK (Dow Jones)--A federal indictment against notorious stock market player Anthony Elgindy and four others broadened Monday with the arraignment of Robert Hansen on conspiracy charges. Hansen managed Elgindy's Web sites and was also in charge of billing the sites' subscribers. In a racketeering indictment unsealed in Brooklyn, N.Y., last May, federal prosecutors alleged that Elgindy, with the help of Federal Bureau of Investigation agents Jeffrey Royer and Lynn Wingate, used confidential FBI databases to guide short-selling strategies. Elgindy is also charged with extorting executives of small firms and manipulating their stock prices. Also charged in the case are Troy Peters and Derrick Cleveland, who according to the government's indictment, assisted Elgindy in committing securities fraud. Hansen was arraigned Monday through a complaint on charges of conspiracy. The government now has 30 days within which to indict him. A lawyer representing Hansen was not immediately available. According to the complaint, Hansen "participated in a conspiracy to commit illegal insider trading and market manipulation." The complaint also alleges that Hansen "participated in the conspiracy principally as the 'webmaster' of internet sites used to disseminate unlawfully obtained non-public information and false and misleading information. The dissemination of this information made it possible for members of the conspiracy, including Hansen, to reap illegal profits from the purchase and sale of securities." So far, only one of the five original defendants pleaded guilty in the case. Cleveland pleaded guilty to racketeering conspiracy in July and is now cooperating with the government. In recent weeks, Brooklyn Assistant U.S. Attorney Kenneth Breen looks to have ramped up his inquiry into the Elgindy case. According to people familiar with the matter, a number of new subpoenas were issued to former subscribers of Elgindy's Web sites. According to a subpoena obtained by Dow Jones Newswires, the government is looking for a wide range of information about Elgindy's Web sites, InsideTruth.com and AnthonyPacific.com, including chat logs, correspondence, consulting agreements and Internet bulletin board postings. The federal government also appears to be focusing its attention on three former subscribers of Elgindy's sites, including Hansen. The subpoena obtained by Dow Jones shows that the Brooklyn U.S. Attorney's office is looking for information about Hansen and two other individuals, in addition to the five defendants charged last May. Hansen was the only new person relating to the Elgindy case arraigned Monday. Finally, the U.S. government seems to be investigating any connection between Elgindy and Imclone Systems Inc. (IMCL). ImClone became embroiled in an insider trading scandal last December after the company's chief executive sold shares ahead of a crucial announcement relating to one of the company's cancer drugs. ImClone wasn't mentioned by name in the original indictment. But the indictment said that FBI agent Wingate did log into an FBI database to check on the chief executive of a Nasdaq-listed company on March 4, 2002 while working at the Albuquerque, N.M., FBI office. Wingate is accused of tapping into confidential government databases to help her former boyfriend Royer after he left the bureau in late 2002. A person with knowledge of the matter said Royer had taken an interest in ImClone while working from Elgindy's office in San Diego in the months before his arrest.
(END) Dow Jones Newswires
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Business/Financial Desk / March 25, 2003, Tuesday Web Operator for Stock Adviser Is Arraigned
By ANDY NEWMAN (NYT)
ABSTRACT - Robert Hansen, who ran Web site for penny-stock adviser Amr Ibrahim Elgindy accused of using information from FBI to manipulate stock prices, is himself arraigned on securities fraud charges in federal court, Brooklyn; Hansen is accused of making more than $100,000 on trades using information illegally obtained by Elgindy; Elgindy sold tips through AnthonyPacific.com and Insidetruth.com; subscribers paid hundreds of dollars per month for exclusive information about pending criminal investigations into small companies; Hansen is released on $200,000 bail (M) The man who ran the Web site for a penny-stock adviser accused of using information from the F.B.I. to manipulate stock prices was himself arraigned yesterday on securities fraud charges in federal court in Brooklyn.
The Web operator, Robert Hansen, is accused of making more than $100,000 on trades using information illegally obtained by the stock adviser, Amr Ibrahim Elgindy.
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