Justice

Martin Shkreli's Legal Troubles Are Getting Worse

May 4th 2016

By:
Kyle Jaeger

Former pharmaceutical executive Martin Shkreli learned that he was facing new federal charges, including securities fraud, on Tuesday during a court appearance in New York. The so-called "pharma bro" rose to infamy last year after his drug company, Turing Pharmaceuticals, raised the price of a life-saving drug, Daraprim, by about 5,000 percent, from $13.50 to $750 per pill.

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In December, Shkreli was arrested by FBI agents on seven counts of securities fraud and conspiracy to commit securities and wire fraud, but prosecutors plan to unveil an additional indictment related to his existing charges, NBC News reports. Details about the pending indictment are not yet known. Shkreli's next hearing is set for June 6.

"I think today was a good day for Martin Shkreli," Ben Brafman, Shkreli's lawyer, said outside the courthouse on Tuesday. "We do not think the indictment will change in any way or affect Mr. Shkreli in any way. I don't want to talk about an indictment that I have not seen."

Shkreli subtweeted prosecutors in his case.

"How much spaghetti can you throw at a wall in an attempt to see what sticks?" Shkreli wrote on Twitter. "Asking for a friend..."

Shkreli has maintained his innocence since his arrest in 2015, calling the case against him "baseless and without merit."

But the Securities and Exchange Commission alleges that Shkreli effectively ran a Ponzi-like scheme, misappropriating money from at least two hedge funds he previously owned to pay off jaded investors who lost market bets at Shkreli's earlier companies.

"According to court documents, Shkreli and his co-defendant Evan Greebel used investor funds from Retrophin [a drug company Shkreli owned before he founded Turing] to pay more than $7.6 million 'through sham consulting agreements' to settle claims with investors from earlier failed hedge funds, 'even though Retrophin was not responsible for those claims," CNN Money reports.

ATTN: reached out to Shkreli and his lawyer, Ben Brafman, for comment, but they were not immediately available.

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