Feds Arrest the Man Who Claimed to Own Half of Facebook

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For two years, Paul Ceglia has doggedly pursued claims that he is entitled to half ownership of Facebook based on a contract he had with Mark Zuckerberg when the Facebook CEO was a Harvard student. Ceglia’s legal campaign has now ended spectacularly–he has been arrested and faces fraud charges.

Kashmir Hill from Forbes reported, “Federal prosecutors for the Southern District of New York have issued a criminal complaint against Ceglia for mail and wire fraud, accusing him of using the U.S. Postal Service to fraudulently sue Facebook. According to the complaint, ‘there is probable cause to believe that Paul Ceglia, the defendant, an online businessman, has engaged in a multi-billion dollar scheme to defraud Facebook and Mark Zuckerberg. Ceglia filed a federal lawsuit falsely claiming that he was entitled to at least a 50% interest in Facebook.'”

The Inquirer’s Dave Neal wrote, “No one is mincing their words about the case, and the US Attorney accused Ceglia of being ‘blatant’ in his scam. ‘As alleged, by marching into federal court for a quick payday based on a blatant forgery, Paul Ceglia has bought himself another day in federal court for attempting a multi-billion dollar fraud against Facebook and its CEO,’ said [US Attorney Preet] Bharara. ‘Ceglia’s alleged conduct not only constitutes a massive fraud attempt, but also an attempted corruption of our legal system through the manufacture of false evidence. That is always intolerable. Dressing up a fraud as a lawsuit does not immunize you from prosecution.'”

Peter Lattman from The New York Times observed, “From the moment the lawsuit was filed, Facebook’s lawyers have called Mr. Ceglia a mountebank and raised questions about his credibility. In 1997, Mr. Ceglia pleaded guilty to possessing hallucinogenic mushrooms. And in 2010, the New York State attorney general criminally charged him with defrauding customers in a now-defunct wood pellet manufacturing business that he had run with his wife.”

BBC News noted, “Arrested at his home in Wellsville, New York, Mr Ceglia was due in court on Friday afternoon.”