War Profiteer Held Without Bail

David H. Brooks, a suspected war profiteer in the sale of body armor to the military, has been arrested for insider trading, fraud and tax evasion and is held without bail . Brooks is accused of defrauding investors out of nearly $200 million. Court papers filed by the prosecution also allege ties to organized crime as a reason for holding him without bail.

Federal prosecutors say in court papers that David H. Brooks, the indicted former head of DHB Industries, should be held without bail as a danger to the community because he has threatened people and has had close ties to a recently murdered member of the Genovese organized-crime family.

There is no suggestion in the court papers filed Thursday by Assistant U.S. Attorney John Martin that Brooks was involved in the April murder of Genovese family member Frank Lagano.

Rather, Martin argued that Lagano is the type of individual that Brooks was referring to when he claimed, according to unidentified witnesses, "to 'have guys' who could take care of his adversaries." Martin did not provide examples of Brooks' actually being responsible for any physical attacks on any individuals.

[...]

U.S. District Judge Joanna Seybert held Brooks without bail pending a hearing. The hearing had originally been scheduled for Monday, but has been moved to Tuesday.

From AlterNet:

America's most ostentatious war profiteer is no longer a free man. In a long-anticipated move, FBI agents arrested bulletproof vest maker David H. Brooks in his Manhattan apartment at dawn on Thursday. In the tradition of Al Capone, Brooks was nabbed on allegations of financial shenanigans, despite strong suspicions that the defense contractor has much more serious crimes on his hands.

Brooks emerged as the poster boy for shameless war profiteering in November of 2005 when he blew some $10 million in profits from military contracts on a celebrity-studded party for his daughter. Leaked details of the bash drew national attention, including a description of Brooks' pink suede suit and photos of his daughter on stage with the rapper 50 Cent. A New York Times editorial compared Brooks to the ill-fated Marie Antoinette.

And indeed, while Brooks won't face a guillotine for his greed, he could spend up to 70 years in prison if convicted of all charges. The 71-page indictment (PDF) alleges that while Brooks was chief executive of DHB Industries, a leading provider of military body armor, he pocketed more than $185 million from insider trading, fraud and tax evasion. He is also charged with using millions of dollars in DHB funds for personal expenses.

A sampling of the charges authorities say Brooks concealed from shareholders and the IRS:

• $7,900 for a facelift for Brooks' wife
• more than $1 million for expenses related to his 100 trotting and breeding horses
• $101,190 for a belt buckle studded with diamonds, rubies and sapphires
• $101,500 for an armored vehicle for his family's use
• more than $1 million for numerous family vacations, including frequent stays at the Bellagio in Las Vegas and various Caribbean and European villas
• $31,802 to transport one of his daughters and her college friends to Halloween parties in Madison, Wisconsin, using a private jet
• hundreds of thousands of dollars in bonus checks drawn on a DHB bank account handed out by Brooks at a company Christmas party to non-DHB personnel, including his horse trainer
• and of course the predictable $10,000 here, $5,000 there for purchases at Luis Vuitton, Gucci, Gianni Versace, and Prada boutiques around the world

What makes Brooks' greed particularly obscene is that the bullet-proof vests that boosted his fortunes in the first place turned out to be not so bulletproof after all. In May 2005, the U.S. Marines recalled more than 5,000 DHB armored vests after they failed ballistics tests for stopping 9 mm bullets. As reported in a previous story for AlterNet, the Marine Corps Times revealed that Pentagon officials had dismissed repeated warnings by inspectors about deficiencies in DHB's vests.