Payback: Martin Shkreli Arrested for Securities Fraud

Martin Shkreli has had a pretty rough, but deserved, few months. He first made national news back in September, when the 32-year-old former hedge fund manager, CEO of Turing Pharmaceuticals AG, and CEO of KaloBios Pharmaceuticals Inc. announced that he was jacking up the price of the HIV drug Daraprim by roughly 5000 percent. Then, he made news again a few weeks ago when he bought the only copy of a legendary Wu-Tang Clan album, despite apparently not intending to listen to it. Another weird story surfaced earlier this week, when Shkreli announced he was going to help Bobby Shmurda, a Brooklyn-based rapper, get out of jail. But now, he’s in the news for a reason that screams poetic justice–he’s been arrested by federal agents on charges of securities fraud.

The charges against Shkreli will likely concern his time at two firms he previously headed, biotech company Retrophin Inc., where he was CEO, and hedge fund MSMB Capital Management, which he managed. Federal prosecutors are accusing him of taking stock from Retrophin. and using it to pay for “unrelated business dealings”–presumably those of MSMB Capital Management. These are not new allegations–he was previously fired from Retrophin for the same thing, and then sued by its board. New York lawyer Evan Greebel was also arrested this morning for conspiring with Shrkeli on the same matters.

The announcement of Shkreli’s arrest was met with mostly jubilee on the internet, given his status as the “most hated man in America.” After he hiked the price of Daraprim, the U.S. pretty much banded together to condemn him; according to the New York Post, it was even bipartisan: “The cocky 32-year-old was condemned by Democratic frontrunner Hillary Clinton, [and] GOP pole-sitter Donald Trump called him a ‘spoiled brat.'” Additionally, Bernie Sanders rejected a $2,700 campaign donation from Shkreli, instead donating it to an HIV clinic.

Shkreli could end up being banned from running a public company, according to Bloomberg Business: “which could put the future of KaloBios into question. Trading in KaloBios shares was halted after the stock fell 53 percent. It’s less clear what the impact could be on Turing, which is privately held.”

There will be a press conference this afternoon from the prosecutors to address the charges being levied against Shkreli, so we’ll have more information then. But for now, let’s all take comfort in the fact that Shkreli seemingly is getting what he deserves.

Anneliese Mahoney

Anneliese Mahoney is Managing Editor at Law Street and a Connecticut transplant to Washington D.C. She has a Bachelor’s degree in International Affairs from the George Washington University, and a passion for law, politics, and social issues. Contact Anneliese at amahoney@LawStreetMedia.com.