The brash and widely-despised pharmaceutical CEO Martin Shkreli orchestrated a "web of lies and deceit," U.S. Attorney Robert Capers said in a press conference after Shkreli's arrest today. "His plots were matched only by efforts to conceal the fraud, which led him to operate his companies, including a publicly traded company, as a Ponzi scheme, where he used the assets of the new entity to pay off debts from the old entity."
Shkreli, a 32-year-old apparent wunderkind, had founded a hedge fund, MSMB Capital in 2009. The feds allege that MSMB Capital was failing—with only $700 in its accounts while Shkreli claimed it had $35 million— and, based on various lies, Shkreli got another $3 million in investments.
After abandoning MSMB Capital, Shkreli then created MSMB Healthcare and Retrophin Pharmaceuticals, for the alleged purpose of paying back MSMB Capital investors. Andrew Cereseny of the Securities Exchange Commission said, "Shkreli committed fraud in nearly every aspect of his hedge fund managing."
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