New York lawyer goes on trial for fraud charge tied to Maxim magazine

by Reuters
Monday, 9 November 2015 20:57 GMT

By Nate Raymond

NEW YORK, Nov 9 (Reuters) - A New York lawyer went on trial on Monday on charges he participated in a scheme involving the impersonation of a successful businessman that was aimed at fraudulently obtaining millions of dollars to buy Maxim magazine.

Harvey Newkirk, a former lawyer with the law firm Bryan Cave LLP, helped convicted con man Calvin Darden Jr. pretend to be his father, a retired senior executive with United Parcel Service Inc, in order to sell lenders on the $31 million deal, a prosecutor told jurors in federal court in Manhattan.

Newkirk, 39, had an undisclosed stake in the entity being used to pursue the men's magazine, and "lied over and over" in hopes of pushing the transaction through, Assistant U.S. Attorney Andrew Adams said in his opening statement.

Those lies included telling lenders that Calvin Darden Sr., a board member at Coca-Cola Enterprises Inc and Target Corp in addition to being a former senior vice president for operations at UPS, was putting up collateral for the loans.

"This is a case about greed and lies by a corrupt attorney," Adams said.

Jonathan Harris, Newkirk's lawyer, countered that his client had himself been defrauded. Harris said Darden was now seeking to pull off another con by testifying against Newkirk in hopes of receiving a more lenient sentence.

"He was duped and used by Calvin Darden Jr.," Harris said of his client.

Newkirk was charged in April with wire fraud and other offenses, five months after Darden pleaded guilty to wire fraud charges related to the magazine deal.

Prosecutors said Darden and Newkirk, then counsel at Bryan Cave, provided fake bank account statements and emails to lenders to borrow more than $8 million and were attempting to secure a further $20 million to buy the magazine.

The prosecution said Darden's scheme with Newkirk led to the 2013 announcement that Maxim's then-owner, Alpha Media Group Inc, partly owned by private equity firm Cerberus Capital Management LP, would sell the magazine to a company headed by the elder Darden.

The $31 million deal did not go through and Alpha Media eventually sold Maxim to Biglari Holdings Inc.

Darden, 41, pleaded guilty in 2005 to New York state charges that in a prior career as a stockbroker, he stole almost $6 million from three Wall Street firms and eight investors. He served about 4-1/2 years in prison.

The case is U.S. v. Newkirk, U.S. District Court, Southern District of New York, No. 14-cr-00534. (Reporting by Nate Raymond in New York; Editing by Peter Cooney)

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