The British businessman sold his product as a miracle tool for security forces the world over: a bomb detector equally capable of tracking down everything from diamonds to human remains.
At nearly $62,000 each, the businessman, Jim McCormick, made a killing, literally so.
The devices, it turns out, were “worthless” and “totally useless,” a British prosecutor told a London court Thursday. McCormick faces six counts of fraud charges.
He sold the bogus detectors to more than 20 countries, from Iraq to Afghanistan, from Georgia to Lebanon, raking in an estimated $70 million to $80 million from sales to Iraq alone. McCormick denies the charges, and continues to insist his products are effective.
The bomb-detecting devices named in the charged include the ADE-651, ADE-650 and ADE-101.
Five other people were also charged on Thursday in related cases, including Gary Bolton; Samuel Tree; Joan Tree; Simon Sharrard and Anthony Williamson.
McCormick was originally arrested on charges of fraud in 2010, but remained free while authorities evaluated the detectors. During the investigation, the government moved to ban the sale and export of the devices to Iraq and Afghanistan.
According to BBC News, the Iraqi government used the phony detectors at checkpoints in Baghdad, presumably allowing cars bearing explosives to reach their targets. The British medical journal The Lancet has reported that 12,000 Iraqis died from suicide bombs between the American invasion in March 2003 and December 2010.
Sweep to Five more charged over “bogus” bomb detectors
South Korea’s ruling family is under continued fire this week, eggs included.
Lee Sang-deuk, the brother of the South Korean president, was arrested Wednesday on bribery allegations.
The former lawmaker is accused of taking half a million dollars in bribes from two bankers to protect certain banks from a financial crackdown in Korea. According to The Washington Post, the bankers were from the Solomon and Mirae savings bank, where Korean banking authorities had suspended operations in 2011 for oversight and capital shortages. In exchange for the money, Lee was to use his influence to keep the bank from shutting down.
Protestors awaited Lee outside the courthouse on Tuesday, where they planned to pelt the disgraced politician with eggs.. The Washington Post reported that many of them claimed they had lost money after the government suspended the Solomon and Mirae banks.
The arrest is seen as an embarrassment for President Lee Myung-bak whose five-year term will end early next year. Elections for the next president are being held in December.
Until April of this year, the president’s brother had been a six-term lawmaker for the ruling party in South Korea.
Sweep to South Korean president’s brother arrested over bribery allegations
Orthofix International, a Texas-based medical device manufacturer, will pay $5.2 million to settle charges that its Mexican subsidiary, Promeca, bribed government officials.
According to the U.S. Securities and Exchange Commission (SEC), the bribes went to acquire sales contracts with hospitals. They are said to have produced over $5 million in profits for the company.
The bribes, which company officials spoke of as “chocolates,” came in the form of cash, computers, televisions, and appliances. The subsidiary had reportedly spent $300,000 on the bribes from 2003 to 2010.
Promeca began reporting the bribes as cash advances and allegedly falsified invoices to support the company. As the monetary amounts increased, they were cited as “promotional and training costs.” The Promeca executives that were involved in the scheme have been fired by Orthofix.
In addition to the current settlement, Orthofix had earlier agreed to a $2.22 million penalty under an earlier settlement with the Justice Department in a related action. The parent company also fired the Promeca executives involved in the scheme.
The settlement must still be approved by the court. In addition to the monetary compensation, Orthofix must pledge its books and records would maintain safeguards demanded under the Foreign Corrupt Practices Act (FCPA), and report to the SEC every two years.
This is not the first time Orthofix has had to settle financial disputes. In June, the company paid $34 million to end an investigation into the marketing of their bone growth stimulation products.
Sweep to SEC charges Orthofix International with FCPA violations
Diana Jean Schemo
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