US says ex-Needham CFO spent firm's funds on dog fence

Thu Nov 15, 2012 1:15pm EST

* Glen Albanese charged in wire fraud conspiracy

* Defendant said to steal $1 mln from brokerage

By Jonathan Stempel

Nov 15 (Reuters) - A former chief financial officer of Needham & Co was charged on Thursday with stealing $1 million from the investment banking and brokerage firm and using some of the money to pay for vacations, wine and a dog fence, federal prosecutors said.

Glen Albanese, 41, was criminally charged in U.S. District Court in New Jersey with running a decade-long scheme in which he induced vendors to submit fraudulently inflated bills or fake invoices for services that were not provided.

It was unclear if Albanese has hired a lawyer for his defense. A lawyer who represented Albanese in a prior civil regulatory matter did not immediately respond to a request for comment. Albanese's home phone number is unlisted.

Needham did not immediately respond to a request for comment.

The office of U.S. Attorney Paul Fishman in New Jersey said Albanese received illicit proceeds by accepting envelopes stuffed with thousands of dollars in cash, or by asking vendors to pay his personal expenses.

According to prosecutors, the expenses included landscaping and interior decorating at Albanese's home, thousands of dollars of wine, equestrian equipment, tickets to Walt Disney World and Six Flags theme parks, flights and hotels, and "a designer-breed dog and canine fence."

The scheme ran from 2000 to 2010, prosecutors said.

An FBI spokeswoman said Albanese, of Manalapan, New Jersey, was arrested without incident at his home at about 6 a.m.

Albanese was charged with conspiracy to commit wire fraud, and if convicted faces a maximum 20 years in prison plus a $250,000 fine.

He was scheduled to appear later on Thursday in federal court in Newark, New Jersey.

Albanese resigned from New York-based Needham in February 2011 after the firm began to question his dealings with vendors, according to records of the Financial Industry Regulatory Authority, the securities industry's own regulator.

In September, FINRA brought a civil enforcement case accusing Albanese of improper invoicing. It said he once caused Needham to pay $2,600 as a business expense for four tickets to the 2009 baseball World Series.

The federal government's criminal complaint against Albanese misspells his first name as "Glenn." A spokesman for the U.S. Attorney's office confirmed the proper spelling.

The case is U.S. v. Albanese, U.S. District Court, District of New Jersey, No. 12-mag-07289.

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