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Former Bankest chairman sentenced to 20 years in fraud case

Former Bankest chairman sentenced to 20 years in fraud case

The former chairman of a now-defunct bank involved in a massive fraud case was sentenced Tuesday to 20 years in federal prison and ordered to pay restitution of more than$164 million (euro120 million).
U.S. District Judge Adalberto Jordan imposed the sentence on Eduardo Orlansky, former chairman of E.S. Bankest, who was convicted last year of 44 fraud and money-laundering counts. His brother, former bank president Hector Orlansky, was previously sentenced to 20 years behind bars.
"This lengthy sentence reflects the seriousness and magnitude of this defendant's fraud," said U.S. Attorney R. Alexander Acosta of Eduardo Orlansky's case.
The E.S. Bankest fraud spawned a lawsuit in which one of the victims, Portuguese bank Banco Espirito Santo, won a $521 million (euro381.29 million) judgment against accounting firm BDO Seidman for failing in audits to detect the wrongdoing. The accounting firm plans to appeal.
The $164 million (euro120.02 million) in restitution involves losses suffered by Espirito Santo entities.
E.S. Bankest was involved in a business, known as "factoring," in which accounts receivable are purchased from firms for less than they are worth. Bankest would then collect and keep the difference _ or suffer the losses _ and was accused of inflating or falsifying its records.
At least nine people, including the Orlansky brothers, have been convicted or pleaded guilty to various fraud charges.