Ex-Chief Of U.S. Military Supplier To Go To Prison For Insider Trading
And fraud. And lying to auditors. And obstruction of justice. Boy did this guy screw up.
The U.S. invasion of Iraq combined with the American-led war in Afghanistan provided a great profit opportunity for the body armor manufacturer DHB Industries, which offered the military a needed, life-saving product. David H. Brooks, DHB’s founder and then-CEO, took this opportunity to instead inflate his company’s value through false claims of larger inventory, squirrel away wealth through falsified tax forms, trade on insider knowledge, exploit the patriotism of people who thought they were investing in American soldiers, and then skip out on the company that bears his name right before revelations of his fraud sent the stock price tumbling down to pennies a share. Yesterday he was sentenced to 17 years in prison.
Brooks’s fraud fortunately didn’t involve making sub-par armor. The Interceptor Body Armor DHB produced has largely been replaced by the “Improved Outer Tactical Vest,” made by (among others) Brooks’s former company, since renamed Point Blank Solutions, Inc.