*Martin Shkreli – the man millions now call a douchebag for trying to price-gouge a life-saving AIDS drug, then, buying the only copy of Wu Tang Clan’s new album “Once Upon a Time in Shaolin” for $2 million – was arrested Thursday morning in New York City on charges of security fraud and “widespread fraudulent conduct.”
In the U.S. Securities and Exchange Commission’s complaint, Shkreli is accused of “misappropriating” more than $1 million from MSMB Capital Management and MSMB Healthcare, two hedge funds Shkreli founded and managed. Both hedge funds, as well as his lawyer Evan Greebel, are defendants in the complaint.
According to the SEC, “Shkreli made material misrepresentations and omissions to investors and prospective investors in MSMB; lied to one of MSMB’s executive brokers about MSMB’s ability to settle short sales.” He’s also accused of having “misappropriated funds” from MSMB to the tune of $120,000 between 2009 and 2014.
As for his second hedge fund, Shkreli is accused by the SEC of misappropriating “approximately $900,000 of investor funds from MSMB Healthcare to fund the settlement of an arbitration process” involving a separate company in 2013.
Bottom line, he’s accused of using investors’ money to pay for his legal problems.
In addition to famously buying Wu-Tang Clan’s exclusive album, Shkreli recently told HipHopDX he was considering paying jailed rapper Bobby Shmurda’s $2 million bail.
Shkreli first earned a national profile when critics blasted him for attempting to raise the price on a life-saving AIDS drug from $13.50 per pill to $750 as CEO/founder of Turing Pharmaceuticals.