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Former Lazard exec indicted
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December 3, 1997: 6:56 p.m. ET
Ex-employee, outside adviser face charges of conspiracy, wire fraud
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NEW YORK (CNNfn) - A federal grand jury in Georgia on Wednesday indicted former Lazard Freres & Co. partner Richard Poirier and outside financial adviser Michael deVegter on charges of conspiracy and wire fraud.
The criminal charges relate to an alleged kickback scheme in which executives in the company's municipal bond department are accused of paying $41,936 to deVegter in 1992. He went on to help Lazard land a $163 million municipal bond issue in Fulton County, Ga.
Last month, the Securities and Exchange Commission filed a civil suit against the firm. To settle that suit, Lazard Wednesday agreed to pay a civil penalty of $10 million to the United States and make $1 million in restitution to Fulton County and the Fulton-DeKalb (Ga.) Hospital Authority. The settlement did not require an admission of guilt.
A second former Lazard employee, James Eaton, has already pled guilty to a wire fraud charge in connection with the SEC complaint.
The SEC also charged Poirier with making an undisclosed payment to deVegter in exchange for assistance in securing the company a role in a 1992 municipal securities offering by the Duval County (Fla.) School Board.
As a result of the alleged misconduct, the government says Lazard defrauded the issuers and investors in three municipal securities offerings. Additionally, the government says the former partner used third parties to funnel political contributions that were falsely billed as charges for consulting and other services in violation of the Municipal Securities Rulemaking Board's fair dealing rule.
The SEC said it is continuing its investigation into the so called "pay-to-play" practices in Georgia and Florida. 
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