Kosta S. Kovachev, 57, formerly a registered broker with the NASD was arrested December 22 on charges he conspired with previously charged, Marc Dreier, pictured left, to sell fictitious promissory notes. Kovachev is charged with one count of conspiracy to commit wire fraud and faces up to 5 years in prison and a fine of $250,000 if convicted. He is alleged to have acted as the middleman between Dreier and three separate hedge funds in selling the fraudulent notes. We note that Kovachev was charged by the SEC with being part of a separate Ponzi-type fraud scheme with other co-defendants. Recall that Dreier was charged on December 8th with securities and wire fraud in connection with the sale of those phony promissory notes that resulted in investor losses of at least $380 million.Read FraudTalk's original post on the Dreier story here.
Read the DOJ announcement here.
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