The prosecution has continued to call witnesses and show evidence in the trial of Martin Shkreli, providing the jury with documents to prove that Shkreli mislead investors by telling them he was managing $100 million when his fund had a balance of negative 33 cents in its prime brokerage account.
Another witness and former Shkreli investor told the jury how couldn’t tell if Shkreli’s flirts were genuine, or if the “Pharma Bro” really did have feelings for him.
According to the New York Daily News, Steven Richardson — a man who told Brooklyn federal jurors he’s had a domestic partner for 25 years — testified Tuesday he wondered if Shkreli’s quips about hookups and sex were just ploys to strike a rapport with the 63-year-old investor.
It got to the point that Richardson had to have a March 2010 talk with Shkreli, 34. After cocktails at Richardson’s Chelsea apartment, he said he sat Shkreli down on his bed. “I said, ‘Do you have any physical feelings for me?’ He took a second he said, ‘No, I like you a lot but I don’t.’”
Prosecutors also called Dr. Lindsay Rosenwald as a witness to discuss how his $100,000 investment with Shkreli turned out. Rosenwald ended up with Retrophin stock that he ended up selling for between $400,000 and $600,000. He also told a story about when Shkreli awkwardly hit him up about a dating lead. Shkreli allegedly asked Rosenwald if a certain woman was single. He then said he wanted it to be known “there is a handsome young hedge fund millionaire she should be dating.”
Meanwhile, a government accountant called by the prosecution went through bank-account records to try and corroborate the government’s argument. A bank account maintained by one of Martin Shkreli's hedge funds in July 2011 had a balance of "negative 33 cents" in it, at the same time he was telling investors his funds had tens of millions of dollars under management, an accountant testified Tuesday, according to CNBC.
That accountant also said that an analysis of one of Shkreli's funds, MSMB Capital Management, showed that it never at any one point had a total of more than $1.2 million in its bank account and brokerage account combined. And the combined balance of a brokerage account and several bank accounts maintained by his other fund, MSMB Healthcare, never topped $1.6 million, Wendy Spaulding, the accountant, testified in Brooklyn, New York, federal court.
The accountant revealed Tuesday that Retrophin, a drug company founded by Shkreli, paid $10,000 for Jay-Z concert tickets at a time when the company had just tens of thousands of dollars in its own bank accounts.
And the accountant testified that records showed more than $1.3 million from Retrophin being transferred to Shkreli's personal bank account, and another $26,000 being transferred into that account from MSMB Capital.
Spaulding’s testimony could be damning for Shkreli, CNBC noted, because several witnesses have already testified that he told them he was managing between $30 million and $50 million.
Prosecutors also accuse Shkreli of looting Retrophin of money and stock to pay off investors in his hedge funds once they began demanding their money back.
Those investors also have said that Shkreli told them his hedge funds had a balance of long and short positions in publicly traded stocks, and that the funds as a rule did not have more than 10 percent of their investments in any single company.