Martin Shkreli, the former hedge fund manager and pharmaceutical executive charged with securities fraud, told “lies upon lies,” prosecutors told a Brooklyn jury on Thursday. He lied about the size of his hedge funds, whether they had an auditor and how they were performing. He lied about attending Columbia University, the prosecutor said.
In closing statements, Assistant U.S. Attorney Alixandra Smith offered a detailed recounting of the lies prosecutors say Shkreli told to investors to persuade them to give him money. Shkreli told investors his funds had money when they were actually broke, said Smith. “Depending on which investors he is talking to, he changes the story,” she said.
While Smith repeatedly called him a liar, Shkreli sat a few feet away smirking and fiddling with his hair. Shkreli – who has been nicknamed “Pharma Bro” on social media – became infamous for raising the price of a vital drug used by AIDS patients by 5,000 percent and then publicly lamenting that he didn’t raise it more.
But that is not why he is on trial. Shkreli is charged with defrauding investors at two hedge funds that he founded, MSMB Capital and MSMB Healthcare. When one of the funds collapsed, rather than tell investors, Shkreli raised more money and then used the cash to start a pharmaceutical company, Retrophin, according to prosecutors. When the hedge fund investors began to ask for their money, Shkreli paid them back using Retrophin money and stock.
The arrangements were not approved by Retrophin’s board of directors and cost the company more than $10 million, according to prosecutors.
Shkreli’s defense team has sought to rebut the accusations with a simple argument: His investors were not victims but wealthy people whom Shkreli made even richer. Despite troubles with his hedge funds, Shkreli’s investors walked away with a profit, defense attorneys have said.
The defense team did not offer any witnesses, and Shkreli did not testify. They are scheduled to offer closing statements Thursday afternoon.
Shkreli’s fate will soon be in the hands of the jury – five men and seven women – who have sat through more than four weeks of testimony that veered between technical explanations of how hedge funds work and complicated accounting terms to riveting stories of Shkreli’s interactions with investors and employees, including one he threatened to drive into homelessness. He told one investor that he wanted to be like Steve Cohen, the billionaire hedge fund investor.
The testimony has painted Shkreli as a sometimes socially awkward man who nonetheless convinced dozens of wealthy investors to fork over millions of dollars. Prosecutors say that is because he is a con man, while his defense says investors were betting on Shkreli’s genius.
Even after being charged with eight counts of securities and wire fraud, Shkreli appeared to relish in the media attention, taunting reporters on Twitter and smirking his way through a congressional hearing about rising drug prices.
Shkreli’s antics continued throughout the trial. One day he casually strolled into a room full of reporters and mocked prosecutors as the “junior varsity” and then lamented that “the world blames me for almost everything.” That incident drew a rebuke from U.S. District Judge Kiyo Matsumoto, who ordered him to stop talking to the media in the courthouse or outside on the street.
(c) 2017, The Washington Post · Renae Merle