Shkreli Fraud Case: Scarsdale Lawyer May Have Steered Corporate Client into Danger: NYT

As outside legal counsel for biopharmaceutical company Retrophin Inc., Scarsdale resident Evan Greebel is accused of creating fake consulting deals on behalf of CEO Martin Shkreli to hide the misappropriation of Retrophin’s funds, according to a profile of the Shkreli fraud case in The New York Times.

Such deals were needed, Greebel is alleged to have told Shkreli in an email, essentially to appease auditors of the public company, who may want a record of a financial transaction.

The two men were arrested by federal authorities last week for their alleged roles in a complex financial fraud case where money from Retrophin was taken to pay off investors in Shkreli’s separate hedge funds. Both have pleaded not guilty and deny the charges.

As such, the Times says, prosecutors hope to paint a picture of Greebel putting Shkreli’s interest ahead of his real client Retrophin, breaching the trust a corporation puts in its outside legal counsel.

“Are we treating lawyers differently from other gatekeepers, such as accountants,” a rhetorical question asked by Securities and Exchange Commissioner Kara M. Stein in a speech she gave in 2014, as reported by the Times, well before Greebel’s arrest. “I think we should carefully review the role that lawyers play in our markets, with a view towards how they can better help deter misconduct and prevent fraud.”

Click here to read the full story on The New York Times website.

Photo: Evan Greebel