DAVID H. BROOKS, FOUNDER AND FORMER CHIEF EXECUTIVE OFFICER OF DHB INDUSTRIES, INC., AND SANDRA HATFIELD, FORMER CHIEF OPERATING OFFICER, INDICTED FOR INSIDER TRADING, FRAUD, OBSTRUCTION OF JUSTICE, AND TAX EVASION
Defendants Allegedly Reaped Nearly $200 Million Through Their Schemes
A superseding indictment was unsealed this morning in federal court charging two former officers of DHB Industries, Inc. (“DHB”), a leading supplier of body armor to the U.S. military and law enforcement agencies, with insider trading, fraud, obstruction of justice, and tax evasion.
The charges announced today are merely allegations, and the defendants are presumedinnocent unless and until proven guilty.
Close The defendants are DAVID H. BROOKS, DHB’s former Chief Executive Officer, and SANDRA HATFIELD, former Chief Operating Officer. HATFIELD was previously charged with securities fraud in an indictment returned in August 2006.
The charges were announced by Benton J. Campbell, United States Attorney for the Eastern District of New York, Mark J. Mershon, Assistant Director-in-Charge of the Federal Bureau of Investigation, New York Field Office, and Patricia J. Haynes, Special Agent-in-Charge, New York Field Office, Internal Revenue Service, Criminal Investigation.
The new indictment alleges that the defendants manipulated DHB’s financial records to increase reported earnings and profit margins, thereby inflating the price of DHB’s stock, of which they both had significant holdings. They also conspired to enrich themselves and their families at the expense of DHB by causing the company to pay personal expenses and millions of dollars above the defendants’ authorized compensation. When DHB’s stock price rose to nearly $20 per share in late 2004, BROOKS and HATFIELD sold several million shares of their DHB stock, with BROOKS realizing more than $185 million and HATFIELD more than $5 million. The defendants also allegedly defrauded the United States government out of millions of dollars in tax revenue by failing to report to the IRS more than $10 million dollars in bonus payments to themselves and other DHB employees.
For the full text of the press release
http://newyork.fbi.gov/dojpressrel/p...ding102507.htm
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