Martin Shkreli’s prized Wu-Tang Clan album might end up on a government auction block.
A judge on Monday authorized the federal government to seize rare Wu-Tang and Lil Wayne albums owned by Mr. Shkreli, the former pharmaceutical executive convicted of fraud, if he can’t come up with the $7.36 million he owes the government.
Judge Kiyo A. Matsumoto of Federal District Court in Brooklyn ruled Monday that Mr. Shkreli owes the money to pay back what he made from his fraud.
Mr. Shkreli’s lawyers had argued that he owed nothing.
Judge Matsumoto also authorized the government to seize Mr. Shkreli’s assets, including his one-of-a-kind Wu-Tang album, “Once Upon a Time in Shaolin,” for which he reportedly spent more than $1 million; a Lil Wayne album, “Tha Carter V”; a Picasso painting; his shares in Vyera Pharmaceuticals; and $5 million in an E-Trade account securing Mr. Shkreli’s bond, which makes up “the majority of Mr. Shkreli’s liquid assets,” according to a court filing by Mr. Shkreli’s lawyers.
The government is allowed to access the other property because it showed that Mr. Shkreli had “transferred,” “substantially diminished” or “commingled” the direct proceeds of his fraud, Judge Matsumoto wrote.
Mr. Shkreli is perhaps best known for hiking the price of Daraprim, a drug treating a rare disease, by 5,000 percent overnight when he ran a pharmaceutical company. Since then, he has become notorious for attention-seeking antics that he publicized online, including the purchase of the Wu-Tang album.
Last summer, he was charged with defrauding investors when he ran hedge funds and a different pharmaceutical company early in his career. Jurors found him guilty of three of eight counts of fraud after a five-week trial.
Mr. Shkreli initially avoided prison, staying out on bail. But less than a month after his conviction, Judge Matsumoto ordered him jailed after he offered his social-media followers $5,000 if they could “grab a hair” from Hillary Clinton during her book tour. Since then, he has been held at the Metropolitan Detention Center in Brooklyn.
Mr. Shkreli is scheduled to be sentenced on Friday.
His lawyer, Benjamin Brafman, said in court filings that Mr. Shkreli had already seen at least one of his items seized by the government: Tax authorities in New York took, and auctioned off, his Enigma code-breaking machine.
If Mr. Shkreli’s assets are seized by the government, the United States attorney general can dispose of them, potentially by auctioning them off.
https://www.nytimes.com/2018/03/05/business/martin-shkreli-wu-tang-album.html
