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Published On: Tue, Aug 15th, 2017

Price-gouging ‘Pharma Bro’ Martin Shkreli arrested for securities fraud

The most hated man on the Internet may be going to prison.

Martin Shkreli, the 32-year-old CEO of Turing Pharmaceuticals who became infamous for boosting the price of alife-saving drug more than 5,000 percent, has been arrested by the FBI for securities fraud, reports Bloomberg News.

Shkreli’s arrest has nothing to do with price gouging, however. Instead, federal prosecutors have accused him of taking stock from a firm he founded in 2011, Retrophin Inc., and using the stock to pay off debt related to MSMB Capital Management, a hedge fund that collapsed after losing millions of dollars, as well as personal debt. Shkreli is also accused to misleading clients to get them to invest in two funds.

He first sparked the public’s wrath earlier this year after news that Turing jacked-up the price of Daraprim, a drug used to boost the immune systems of people with life-threatening illnesses like HIV, from $13.5 per pill to $750. He quickly became the face of corporate greed and a poster boy from everything that people feel is wrong with a capitalist system.

Adding to his villainous image, Shkreli later reneged on his promise to lower the price of Daraprim. It was later revealed that he was also the mystery person who purchase the only copy of Wu-Tang Clan’s albumOnce Upon a Time in Shaolinfor millions of dollars.

In a lawsuit filed in August, Retrophin accused Shkreli of a number of complex financial transactions that include poaching company funds in fraudulent transactions with investors in MSMB. The company also alleges that Shkreli used fake consulting agreements, as Bloomberg puts it, to pay off some MSMB investors, among other allegations of wrongdoing.

Writing on the investment forum Investorhub in February 2015, Shkreli shrugged off Retrophin’s allegations as completely false, untrue at best and defamatory at worst.

I am confident that anyone who looked into the transactions would find them perfectly legal, reasonable and quite intelligent (the results of the company speak for themselves), Shkreli added. I welcome any scrutiny by any party and have faith any investigation will be resolved without issueit would not be the first time and it won’t be the last that my moves have been looked atthis is not my first rodeo and I have too many scars to do something stupid.

Shkreli, as well as a second defendant, attorney Evan Greebel, could face up to 20 years in prison, if convicted.

Adding to Shkreli’s legal woes, the New York Attorney General’s office launched an investigation into whether Turing intentionally impeded other companies in creating generic versions of Daraprim, which could be sold at a lower cost.

Later that month, Imprimis Pharmaceuticals Inc. began selling its own version of Daraprim for approximately $1 per pill.

Update 4:35pm CT, Dec. 17: Shkreli and another defendant, Evan Greebel, face up to 20 years in prison.

Screenshot via ABC News

Read more: http://www.dailydot.com/politics/martin-shkreli-arrested-securities-fraud/

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Price-gouging ‘Pharma Bro’ Martin Shkreli arrested for securities fraud