Citigroup, Stanford, Primary Global in Court News

Chief Executive Officer Vikram Pandit and Pramit Jhaveri, head of the bank’s Indian unit, were cleared by local police of involvement in an alleged $66 million fraud at its branch in Gurgaon. Citigroup employee Shivraj Puri was taken into custody as part of an investigation into complaints that he forged documents to lure investors, S.S. Deswal, commissioner of police in Gurgaon near New Delhi, told reporters yesterday. The alleged fraud was confined to Citigroup’s Gurgaon office and involved 3 billion rupees ($66 million) that was invested over 15 months, Deswal said. Senior Citigroup executives were accused by Helion Advisors Pvt. Managing Director Sanjeev Aggarwal of conspiring with Puri to defraud him of 324.3 million rupees, according to an e-mailed statement yesterday. The New York-based bank last week filed a police complaint accusing Puri of promising “extraordinary high interest rates” to lure clients and siphoning funds. “Citi identified the fraud and immediately reported the matter to the regulators and law enforcement agencies,” Debasis Ghosh, a spokesman for Citigroup in Mumbai, said in an e-mail. Aggarwal’s “claims against senior executives are completely without basis and we intend to contest them vigorously.” “Citi will continue to work with the authorities on this investigation,” Ghosh said. Aggarwal didn’t return two calls to his mobile phone and one to his office. Trials/Appeals PharmAthene Funded Siga Drug Trial, Official Says PharmAthene Inc. provided funding to Siga Technologies Inc. to conduct a human safety trial of a drug designed to fight smallpox outbreaks linked to terrorist attacks, a PharmAthene official testified. Siga was persuaded by PharmAthene to conduct the first phase of human safety trials for its smallpox antiviral ST-246 without funding from the U.S. National Institutes of Health in order to get human data on the product faster, Valerie Riddle, PharmAthene’s senior vice president and medical director, testified yesterday in Delaware Chancery Court. “PharmAthene provided the funding to Siga,” Riddle said during the second day of a trial in PharmAthene’s lawsuit against Siga over a licensing agreement for the smallpox medicine. PharmAthene, based in Annapolis, Maryland, sued New York- based Siga in 2006, asking a judge to affirm the purported licensing agreement for the drug, which has gotten the attention of U.S. officials seeking ways to counter potential biological terror attacks. Siga contends there is no license and the company isn’t legally bound by documents prepared for a deal. Riddle testified that PharmAthene also helped Siga prepare for a site meeting for a contract proposal that it submitted to the NIH. In addition, PharmAthene advised Siga on applying for a drug designation that provides for tax credits and marketing incentives, she said. “Working toward developing 246 was the goal regardless of the business arrangement,” Riddle said. “I always thought we would get 246 either under a merger agreement or under a license arrangement.”