The former CEO of DHB Industrieswas arrested yesterday by the FBI on charges that included conspiracy, insidertrading, and tax fraud. Also charged was former DHB Industries COO SandraHatfield. DavidBrooks was arrested yesterday morning, according to Robert Nardoza, a spokesmanfor the U.S. Attorney’s office in Brooklyn, N.Y.
DHB hassince changed its name to Point Blank Solutions andmoved its headquarters from Westbury, N.Y., to Florida, Nardoza said. TheBrooklyn U.S. Attorney’s office described DHB as “a leading supplier ofbody armor to the U.S. military and law enforcement agencies.” DHB’s netsales in 2006 were $254 million.
Ifconvicted, Brooks and Hatfield face a maximum term of imprisonment of 25 yearsfor securities, mail and wire fraud, insider trading, and conspiracy to committhese offenses; 25 years for insider trading; 20 years for obstruction ofjustice and false statements; and five years for tax fraud, evasion, and filingfalse returns. The defendants also face a fine equal to twice the pecuniarygain or loss resulting from their fraud schemes; the government is seekingforfeiture of approximately $190 million from the defendants for securitiesfraud violations. Earlier yesterday, the government filed an application torestrain approximately $130 million of identifiable assets held by Brooks,including bank accounts and brokerage accounts.
TheSecurities and Exchange Commission yesterday filed a civil complaint againstBrooks in federal court in the Southern District of Florida.