The bad blood between rival drug developers Amphastar and Momenta has bubbled over into public view. Questions over the firms' competing franchise for a generic version of the blockbuster blood thinner Lovenox has led to allegations of misconduct at the FDA, the hiring of a prominent security firm to investigate those accusations and the announcement of a Congressional investigation into the hiring of said security company.

Amphastar and Momenta are both seeking approval to sell a their own version of the blood thinner heparin. While the companies are neck-in-neck for approval, Amphastar actually applied two years ahead of Momenta. The years of regulatory delays, while billions of dollars hang in the balance, have seen the competition between the two pharmaceutical companies turn decidedly ugly. Squabbling over the fairness of the FDA's drug approval processes has led to charges of favoritism.

Amphastar has gone so far as to file a complaint alleging that Momenta had received preferential treatment from Janet Woodcock, director of the FDA/s Center for Drug Evaluation and Research. The Amphastar complaint sought Woodcock's recusal from the proceedings, and cited supposed special access to Woodcock enjoyed by Momenta and the fact that Woodcock had co-autored a scientific paper with Momenta researchers during the period both companies were pursuing FDA approval for their generic version of the blockbuster blood thinner.

For its part, Momenta contends that the contact with the FDA has been appropriate and that Momenta has certainly lobbied the government to utilize a higher standard for approving a heparin generic - one that presumably Momenta would be able to meet, but Amphastar might not. The FDA has seemed responsive to Momenta's line of argument citing evolving science and the complexity of the drugs in question.

The FDA has defended its neutrality, noting that their calls for more details on immune reactions affected both drug makers.

Not content with the FDA's administrative investigation into Woodcock (the FDA will not even confirm such an investigation) Amphastar sought outside help from noted investigative firm, Kroll. That move has caught the attention of senators Max Baucus and Chuck Grassley. The two informed Amphastar of their probe in late September via a joint letter, citing concerns over a drug company hiring an outside firm to investigate a Federal regulatory agency.

We'll see what comes of it...

Labels: Amphastar, Kroll, Momenta

It retrospect, this would have been bad:

...Antiguan authorities moved Friday to take control of Stanford's offshore bank, an action that could put the Caribbean island government at odds with the SEC. Antiguan regulators named British-based Vantis Business Recovery Service as a receiver for the bank that purported to have $8.5 billion in assets in December.

The SEC, which has installed its own receiver over Stanford Financial's US operations, says it can’t account for the money in the bank. The SEC and Antiguan officials could not be reached for comment. Vantis declined to comment. The little-known London-based firm is said to have beat out some better-known corporate clean-up firms for the job, such as Kroll.

It’s not clear if Antiguan authorities consulted with the SEC before making the pick. A person familiar with the Stanford investigation says for months Antiguan authorities were thumbing their noses at the SEC and rebuffing attempts by US regulators to get information on Stanford's offshore operation.

Not only is the Stanford investigation still unfolding. Now it seems it may get ugly too.

Ugly for more than just Allen Stanford, at this point.

-- MDT

Labels: Kroll, R. Allen Stanford, Thomas Cash

Due to the controversy (and litigation) surrounding his connection to accused ponzi fraudster, R. Allen Stanford, Thomas V. Cash has stepped down from his position at Kroll. Cash had served as Kroll's Executive Managing Director in Miami. Cash's bio page on the Kroll website has already been removed.

-- MDT

Labels: Kroll, R. Allen Stanford, Thomas Cash

UPDATE: A colleague in the know has clarified something for me. Despite what the FT said, there are not two separate lawsuits. Rather, there are two complaints, one from Electri as we've previously described. The second complaint comes from National Electrical Contractors Association, which is the organization behind Electri. So to the best of my understanding - two aggreived parties, two complaints, one lawsuit.

Via the FT:

The allegations have also cast a light on the close-knit world of business advisory. Kroll, a risk consultancy firm, has been accused in two separate investor lawsuits of "gross negligence" and of misleading investors via a "clean report" on Sir Allen's operations in 2007, court documents show. Kroll has denied any liability.

Thanks to our friends at Flaneur de Fraude for the tip. They also uncovered this ironic comment on Stanford from author and Kroll investigator William Brittain-Catlin:

"I'm amazed by the way people were taken in by Sir Allen," says William Brittain-Catlin from Kroll, the risk consultancy, and author of Offshore: The Dark Side of the Global Economy. "There’s so much stuff out there that any one who wanted to do a cursory check would have seen. Various allegations have been flying around for years."

Ahem, yes. Well. That is certainly awkward.

-- MDT

Labels: Kroll, R. Allen Stanford, William Brittain-Catlin

You may recall the recent report in Vanity Fair magazine that highlighted the cozy, long term relationship between white collar fraudster, R. Allen Stanford and Kroll - one that involved Stanford paying the investigative firm millions, reportedly, to run interference with inquisitive regulators.

Kroll is facing its first lawsuit relating to the Sanford relationship, filed in Florida's Southern District Court. The complaint has been brought by Electri International, which lost millions investing in Stanford's Stanford International Bank only after hiring - you guessed it - Kroll to vet the deal.

Kroll reportedly issued SIB a clean bill of health in their review, which they claim was "limited due diligence" costing Electri in the neighborhood of $15,000.

Even more interesting, Electri's contact at Kroll in the matter was Thomas V. Cash, Kroll's managing director for investigations in Latin America and the Caribbean. According to Electri's complaint, Cash had been hired as a consultant by R. Allen Stanford in the late 1990s and Kroll never disclosed this relationship. Vanity Fair also named Cash as Kroll's point man with Stanford.

Kroll and Cash are keping mum about the particulars of the Electri lawsuit, but Cash did have this to say to the New York Post:

"I wouldn't believe everything I read in Vanity Fair because most of it's wrong."

Lets take him at his word for the moment and keep close eyes on Florida's Southern District Court.

-- MDT

Labels: due diligence, Electri, Kroll, lawsuit, R. Allen Stanford, Thomas Cash

Exactly why does "Kroll Investigations" have an Amazon reviewer profile? Strike anyone else as an oddity? Then again, the book does sound interesting.

-- MDT

Labels: Kroll

Via Intelligence Online...

Subscription required (but worth your while).

-- MDT

Labels: Kroll, R. Allen Stanford

A nice clip from Felix Salmon, citing this Bryan Burroughs article from the new issue of Vanity Fair (and I must say, that while I don't often read VF, their recent piece of Bernard Madoff was also quite excellent). The Key graph from the Burrough's piece, as it comes to Stanford and Kroll:

...says the former F.B.I. agent Burrough spoke with. "Kroll was essentially running a propaganda campaign in defense of Stanford's good name. They beat on me many times: 'Hey, you got this guy all wrong, he’s not a money launderer, he's a great guy, leave him alone.'

According to Burroughs, the Stanford account was worth millions to Kroll over the years. Allen Stanford was arrested and indicted earlier this month after a lengthy public preamble as well as several close calls from regulators over the years. He is currently in Federal custody.

-- MDT

Labels: Kroll, R. Allen Stanford

Got to hate it when former associates of your target start speaking on the record (negatively) about your interview calls:

...when recently retired Research In Motion vice-president Peter Broughall received a call from one of Kroll's investigators this week, he felt that the line of questioning didn't jibe with what he considered normal corporate protocol.

'If this is due diligence, I found it surprising that the line of questioning was not in line with trying to seek accurate positive information as well as negative,' Broughall says....

'If this is due diligence, I found it surprising that the line of questioning was not in line with trying to seek accurate positive information as well as negative,' Broughall says.

The investigator, who told Broughall that he represented the NHL, said he had been given his name by another former RIM employee. 'I was suspicious going in that this was not something sanctioned by Jim..."

More here...

-- MDT

Labels: Kroll

Hennessee Group, a New York-based investment adviser is facing a $800,000 fine from the SEC due to the firm's failure to perform promised due diligence of the Bayou Group hedge fund, once run by eventual death-faking, scooter-riding fugitive from justice, Sam Israel.

Bayou, of course, was one of the biggest hedge fund flame-outs of all time, with many of the fund's major players doing jail time. The SEC complaint details about 40 Hennessee clients who altogether has about $56 million invested inthe Bayou fund.

Hennssee head, Charles Gradante has neither confirmed or denied wrongdoing in the matter. While he hasn't commented on the specifics of his own case, Gradante has submitted a letter to the SEC with a variety of recommendations for how other migh avoid Hennessee's fate.

Amongst Gradante's recommendations - increased reguation of hedge fund borrowing and requiring that third parties, such has Kroll, be hired to conductforencic audits of hedge fund financial statements. More here, via Bloomberg.

-- MDT

Labels: Bayou Group, Fraud, hedge fund, Hennessee, Kroll, Sam Israel

Why yes, I am a regular reader of MI.

Not a lot new here, but look for comments from several investigative leading lights from that neck of the woods - Chris Leahy, managing director of Kroll's Singapore office and Lawrence Lai, from Ernst & Young Risk Advisory Services and Bob Yap, the local head of forensics for KPMG.

-- MDT

Labels: Bob Yap, Chris Leahy, Ernst and Young, KPMG, Kroll, Lawrence Lai

Focusing on the Kroll Ontrack division and Kroll's Trial Services products.

- MDT

Labels: Kroll

Government reps are making it sound like no big deal - according to a recent report in the Washington Post, since 2007 six investigators working on behalf of the Office of Personnel Management, the agency that heads up background screening for federal jobs, have been charged with making false statements.

Three of the investigators were OPM employees. The three others were employed by government contractors: USIS and Kroll. One of these folks was convicted as recently as last week in Federal court in the District of Columbia. Dozens, if not hundreds of background checks have been admittedly falsified in these cases alone. Tip of the iceberg?

More at the Washington Post.

-- MDT

Labels: background checks, Fraud, Kroll, USIS

HedgeCheck, LLC has announced a DC office and the appointment of two new directors to run the show - Natasha Cayenne-McCall, formerly of Lehman Bros. and Stacy Weiner, formerly of Kroll.

At least someone is hiring out there...

-- MDT

Labels: HedgeCheck, Kroll, Lehman Brothers, Natasha Cayenne-McCall, Stacey Weiner

Kroll is hiring in DC for their OPM contract.

-- MDT

Labels: jobs, Kroll

Is available here (PDF), for your reading pleasure.

-- MDT

Labels: Fraud, Kroll

Just in case you were wondering what he's been up to since retirement.

--MDT

Labels: Jules Kroll, Kroll

Apparently some customers have been threatened with having their stolen personal data revealed unless they pay up. Kroll is assisting Express Scripts in running down the would-be extortionists.

-- MDT

Labels: data breach, Kroll

Profits for Marsh & McClellan fell 78% in the 3rd quarter of 2008. Earnings in Kroll's division were down 3.4%. Interested Kroll buyers, Marsh is apparently still interested in selling...

--MDT

Labels: Kroll, Marsh

See here.

- MDT

Labels: Daniel Dantes, Kroll, wiretapping