Venezuelan Accountant Pleads Guilty in Massive u.S. Fraud

Guillen is to stay under home confinement until July sentencing

Michael Melia All Articles

The Associated Press

May 06, 2011

A Venezuelan accountant pleaded guilty Wednesday to charges that he helped a Connecticut-based hedge fund adviser attempt to cover up a massive, five-year pyramid scheme that could cost investors hundreds of millions of dollars.

Juan Carlos Guillen Zerpa was accused of falsifying a document to throw off federal investigators targeting Francisco Illarramendi, a Venezuelan-American financier who used unregistered hedge funds in Stamford, Conn., as cover for one of the biggest frauds in state history.

Guillen, who was the managing partner of a Venezuelan accounting firm, wore a beige prison jumpsuit and had his hands cuffed behind his back as he was led into the U.S. federal courtroom in Bridgeport. An interpreter translated proceedings into Spanish for him, although he told the judge in English that he accepted his guilt, saying: "Absolutely, yes, your honor."

U.S. prosecutors in Connecticut have called the case against Illarramendi the state's biggest white-collar federal prosecution. The 42-year-old New Canaan, Conn., man was accused of transferring money among investment accounts without telling clients to cover up huge financial losses and then falsifying documents to deceive investors, creditors and investigators. A pension fund for Venezuela's state oil workers accounted for most of the investment totaling hundreds of millions of dollars.

Illarramendi, who served as an adviser to Venezuela's government until 2004, pleaded guilty in March to criminal charges including several counts of fraud and conspiracy to obstruct justice. He faces up to 70 years in prison.

As one of several co-conspirators, Guillen, 44, expected to receive $1 million for agreeing to sign a fabricated letter indicating falsely that one of the funds had made $275 million in outstanding loans to Venezuelan companies, prosecutors said. A payment of $250,000 for Guillen had already been delivered when he was arrested in March by FBI agents in Florida -- money he agreed to forfeit as part of the plea agreement.

In January, he told the U.S. Securities and Exchange Commission that the assets were real despite knowing they did not exist, according to prosecutors.

"There were no loans, and Mr. Guillen and others knew that," prosecutor Richard Schechter told U.S. District Judge Stefan Underhill.

Guillen pleaded guilty to conspiracy to obstruct an official proceeding of the U.S. Securities and Exchange Commission. He faces a maximum sentence of 20 years in prison and a fine of up to $2.5 million. The plea agreement does not put a lower cap on any prison sentence, although he waived a right to appeal a sentence involving less than 33 months in prison. Prosecutors also agreed not to pursue any additional charges against him.

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DLA Piper Loses 6 Canberra Partners to HWL Ebsworth

Jessica Seah All Articles

The Asian Lawyer

May 12, 2011

DLA Piper has lost six partners in Canberra, leaving the firm's office in the Australian capital with just two partners.

The lawyers are joining HWL Ebsworth Lawyers in August to open the firm's Canberra office, the Australian firm announced on Monday. The departures come in the wake of DLA Piper's merger with DLA Phillips Fox, which has already seen 10 partners leave the firm for smaller rivals.

The departure dates of the partners -- Richard Garnett, Lex Holcombe, Stuart Imrie, George Marques, Melanie McKean and Michael Will -- have yet to be confirmed.

They advise public sector clients on issues including negligence claims, workers' compensation, freedom of information, statutory interpretation, administrative law, public liability, product liability and workplace relations.

In a statement, DLA Piper said that the partners have indicated that while they agree integration was the best course of action for the Australian firm, they do not wish to be part of a global business law firm.

With the departures, the firm will have 106 partners in Australia. Its Canberra office will be left with two partners, Anthony Willis and Caroline Atkins.

HWL Ebsworth also announced on Monday it has hired former Mallesons Stephen Jaques senior partner Joe Montano as a partner in the firm's banking and financial services practice in Sydney. Montano specializes in funds management work. He also advises on corporate finance, mergers and acquisitions, and joint ventures.

The seven new additions will take HWL Ebsworth's total partners to 122 across its offices in Brisbane, Melbourne, Sydney and Norwest, New South Wales. The firm has been on a hiring spree this year. Over the past four months, it has taken on laterals from Australia's largest firms including Allens Arthur Robinson, Mallesons and Freehills.

The moves come amid a shift in strategy among Australia's largest firms that has seen a number of partners switch to midsized practices in recent months.

DLA Phillips Fox's merger with DLA Piper has led to a boon for smaller firms. Thomsons Lawyers took on nine partners from the firm's Brisbane office in March. Sydney's Moray & Agnew hired DLA Phillips Fox insurance partner Peter Tredinnick and his team of associates in the same month.

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