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To: jjs64 who wrote (1131)	3/2/2000 4:21:00 PM
From: StockDung	Respond to of 1242

NatWest's Coutts Was Defrauded of $32 Mln, NY Prosecutor Says New York, March 2 (Bloomberg) -- National Westminster Bank Plc's Coutts & Co. private banking unit was defrauded of more than $32 million by two Canadian businessmen who artificially inflated the stock of an Internet gaming company, according to an indictment by a New York grand jury. Jack Banks, chief executive of GalaxiWorld.com Ltd., formerly known as Laser Friendly Inc., and Larry Weltman, the chief financial officer, were charged with grand larceny and fraud. Bail was set at $35 million for Banks and $3 million for Weltman. Both men were arrested Friday when they came to New York for a hearing in a federal class-action lawsuit against their company, the D.A.'s office said. The two Ontario residents have been unable to post bail and remain in custody. Banks and Weltman borrowed $32 million from the former New York office of Coutts in 1995, using Laser Friendly stock as collateral, Manhattan D.A. Robert Morgenthau said. The two men used Laser Friendly to acquire other companies that supplied lottery tickets and betting slips to the gaming industry. When they secured the loan from Coutts, the value of Laser Friendly stock was artificially inflated because Banks and Weltman had failed to disclose they didn't have the necessary licenses and regulatory approvals to operate one of the companies, said John Moscow, Morgenthau's deputy chief of investigations. Coutts lost about $28 million on the loans, Moscow said. Attorneys for Banks and Weltman couldn't immediately be reached for comment. Grand larceny is punishable by as much as 25 years in prison. Another former client of Coutts' New York branch, Rachamim Anatian, was indicted by a New York grand jury in January. Anatian, formerly CEO of Global Broadcasting Systems Inc., was charged with falsifying records in the home-shopping company's bankruptcy case. Anatian had invested in Global Broadcasting using money borrowed from Coutts. Investigators who were looking into possible crimes against Coutts discovered his alleged falsifications, Moscow said in January. Coutts closed its New York branch in 1998 after the office racked up about $100 million in losses, Moscow said. Closely held Ostel Management Inc. in December acquired GalaxiWorld.com, which operates an Internet gaming site. Mar/02/2000 15:47 For more stories from Bloomberg News, click here.

To: jjs64 who wrote (1131)	3/2/2000 9:14:00 PM
From: StockDung	Respond to of 1242

Canadians Charged With Bank Defraud .c The Associated Press NEW YORK (AP) - Two executives of a Canadian-based company have been indicted on charges of stealing more than $32 million from a British bank, Manhattan District Attorney Robert Morgenthau said Thursday. He said the defendants, Jack Banks, 51, and Larry Weltman, 37, were arrested last Friday at the U.S. District Court building in Manhattan where they are defendants in a class-action lawsuit alleging securities fraud. Both were charged with first-degree grand larceny and scheme to defraud under the state's general business law. They face up to 25 years in prison if convicted of grand larceny, the top count. State Supreme Court Justice Robert Lippmann set bail at $35 million for Banks, who said he has homes in Ontario, Gibraltar, Israel and Florida. The judge set bail at $3 million for Weltman, who lives in Thornhill, Ontario. Morgenthau said Banks, chief executive officer of Galaxiworld.com, and Weltman, the company's chief financial officer, defrauded a Manhattan branch of Coutts & Co. of $32 million by artificially inflating the value of their company's stock to get loans. The defendants used Laser Friendly - the former name of Galaxiworld.com - to acquire companies that make lottery tickets, betting slips and other paper betting supplies, Morgenthau said. At some point, he said, they bought such a company in the state of Washington. In Washington, companies that make those supplies are regulated by the state and require licensing and regulatory approval. When Laser Friendly applied to Coutts for loans, its officers neglected to mention that it had not yet received licensing and regulatory approval, Morgenthau said. Coutts gave Laser Friendly loans totaling $32 million. The bank lost a total of $28 million when only $4 million of the loan was recovered. Meanwhile, Laser Friendly was the target of a ``cease and desist' court order obtained by Washington's gaming commission and had to pay the state $750,000 in fines and fees, Morgenthau said. The district attorney said the defendants also defrauded investors who bought Laser Friendly stock at the artificially inflated prices, without knowing the truth about the regulatory status of the company's acquisitions. AP-NY-03-02-00 1626EST