NY Man Faces Charges in Facebook Scam

Paul Ceglia, a wood-pellet salesman from Wellsville, New York, was charged with mail fraud and wire fraud over what the U.S. Attorney's Office in Manhattan said was fabricated evidence to support his claim of a large ownership stake in Facebook. His lawyer could not immediately be reached for comment.

The businessman sued Facebook and its CEO in 2010 claiming a 2003 contract he signed with Mark Zuckerberg, then a Harvard University student, entitled him to a stake in the social media company. This past March, as part of that case, Facebook released emails sent by Mark  Zuckerberg around the time of the contract to show Paul Ceglia's claims were false.

"Ceglia used the federal court system to perpetuate his fraud and will now be held accountable for his criminal scheme," Orin Snyder, a partner at law firm Gibson Dunn representing Facebook and Mark  Zuckerberg in the civil case, said in a statement.

Paul Ceglia, 39, was arrested at his home Friday morning and was to appear in federal court in Buffalo later in the day, authorities said.

Investigators for the U.S. Postal Inspection Service, which is conducting the probe, made the arrest following Paul Ceglia's return this week after spending time out of the country, according to a source familiar with the matter who was not authorized to speak publicly on the case.

The case is USA v. Paul Ceglia, U.S. District Court, Southern District of New York.

Banking Criminals in Very High Places

The UK bank Barclays admitted altering its books for more than 10 years to hide hundreds of millions of dollars from countries such as Cuba, Libya and Iran.

In May, ABN Amro, now part of Royal Bank of Scotland Group, agreed to pay $US500m to end allegations that it helped Iran, Libya, Sudan and Cuba evade US sanctions by “stripping” the identities of transactions to conceal the countries from which they originated.

Last December, Credit Suisse Group paid $US536m to settle similar violations involving transactions with Iran. In early 2009, a unit of London-based Lloyds Banking Group paid $US350 million related to similar charges by US and New York prosecutors, who accused the bank of masking the origin of payments from Iran and Sudan.

The $331m settlement-agreement of criminal charges is an embarrassment for Barclays, which became a major player on Wall Street by snapping up the collapsed US operations of Lehman Brothers in 2008 and has been trying to burnish the UK bank's reputation on both sides of the Atlantic as a good corporate citizen.

A federal court filing said Barclays “accepts and acknowledges responsibility for its conduct and that of its employees”. US officials said the bank altered payment messages or deleted information about sanctioned countries. More