Business manager Gabrielle Smith's high profile clients are suing her for allegedly stealing over $3 million and using parts of the money to pay other investors while pocketing the rest of the money.

Through her company, Premier Business Management L.L.C., Smith's client list included DJ Clue, Warner Music Group's Kevin Liles, Fabolous and a slew of music executives. In lawsuits filed in New York Supreme Court in Manhattan, Smith's former clients also named banks, including J.P. Morgan Chase and HSBC, where she held accounts. The suit also shows that at least one former client is filing private claims against Smith's former employers Morgan Stanley and Prudential Securities in the arbitration proceedings. The firms declined to comment on the allegations. J.P. Morgan Chase and HSBC also declined to comment.

According to sources briefed on the case, Smith has also been indicted on federal charges similar to the allegations made in the aforementioned lawsuit. The charges brought in Brooklyn's Federal District Court, are under seal, meaning that prosecutors may offer a deal for a defendant's cooperation in a separate case. Industry insiders are speculating that Smith may provide information into a money laundering case involving The Inc.'s Irving "Lorenzo" Gotti, his brother Chris and convicted drug lord Kenneth "Supreme" McGriff.

According to a document filed by prosecutors, Smith's company previously managed a bank account that paid business and personal expenses "on behalf of" McGriff. The money laundering case is slated to go on trial this October.

Meanwhile, word is Smith's former clients are still trying to understand how they were fooled. Smith was highly respected in the music industry. She had recently vacationed with Jay-Z and Beyonce in the Caribbean and previously dated former Def Jam vice president of promotion, Michael Kyser. Kyser is now an executive at Atlantic Records.

During a brief phone interview with the New York Times, Smith declined to comment on the record.

However, her lawyer, Kenneth A. Paul did comment to the Times. "I understand people who say they were victimized and say they lost money are upset," he said. "I don't think it's fair to attribute their losses to Gabriele Smith."

Premier Financial was located on Manhattan's West 38th street. Smith and her staff routinely paid bills, invested savings and handled finances for their long list of clients. Her company is now associated to Premier Financial Advisors Inc. located on East 60th Street. In court documents and interviews, several of her clients said she forged their signatures to make unauthorized withdrawals and fabricated account statements to cover transactions.

After dropping out of the University of Maryland, Smith obtained entry-level jobs with Jive Records and Def Jam. In 1995, she earned a slot as a Tommy Boy A&R. The New Jersey Drive soundtrack and Big Noyd's debut, Episodes of a Hustler, are two of the projects she oversaw during her stint at Tommy Boy. She later left the music industry to become a stockbroker and got hired by Morgan Stanley and later Prudential Securities. The two firms had no clue Smith was conducting business on the side. Jim Gorman, a Prudential spokesman, revealed that Smith never asked for the firm's permission to build a side company. He added that they took measures to prevent her from continuing the business the instant they found out.

As her client list featured high-profiled artists, music insiders and professional athletes, some of her clients eventually discovered that their accounts had been whipped out. According to John T. McGuire, a securities lawyer who represents Richard Ford, aka Skane Dolla of Desert Storm, and several other clients, the majority of the money never made it to Prudential. Kevin Liles also sued Smith, claiming that he lost $450,000 while she was working at Morgan and Prudential.

Smith's company suffered another blow when Murder Inc.'s offices were raided back in 2003. According to court reports, Premier had managed an account for McGriff as executive-producer of the straight-to-video flick, Crime Partners. The reports also said the flick helped McGriff launder profits from his drug money. A spokesman for the United States Attorney's Office declined to comment. Smith also managed money for Ronald Robinson aka Gutta. Gutta, Ja Rule's manager, was also indicted on money laundering charges. Sources say Gutta grew frustrated with Smith when she paid his bills late. He eventually fired her shortly before her offices were raided. Carline Balan, Jay-Z's executive assistant is the only one to have recovered her money. She reportedly pressured Smith until she returned her $100,000.

"We've combed through thousands of pages of bank records to try and trace the money," McGuire told the Times. "We have recovered several million dollars for people who were victimized from the financial institutions that were supposed to supervise her. We expect to have some success in recovering additional funds."

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Lloyd Banks and Young Buck were arrested after police allegedly found weapons in a van carrying the rappers and 11 other people as they were leaving the Anger Management 3 tour in New York this morning (August 9).

Reports stated that police pulled the van over for running a red light on 41st and Eighth Avenue in Manhattan.

Police reportedly found two firearms in the vehicle and subsequently arrested eleven passengers. Police allege they found a loaded .40 caliber and a .357 handgun on one of the passengers. Everyone in the vehicle was charged with weapons offenses.

Manager Sha Money XL confirmed with AllHipHop.com that Lloyd Banks and Young Buck were arrested. He declined to comment any further.

"They told the crowd to put their fists in the air and then told the crowd to put up their middle finger," one concert goer told AllHipHop.com. "Then they yelled out f**k the police and the crowd shouted it back."

The other men arrested ranged from age 20-41.

The NYPD's Intelligence Unit has spent the last few days checking the streets to see if any violence might be directed towards 50 Cent and G-Unit during their stop in New York.

With heavy police presence, the Anger Management concert went off without a hitch last night and will resume tonight.

Lloyd Banks, Young Buck, Mobb Deep, Olivia, Tony Yayo, M.O.P. 50 Cent, D12, Proof, Obie Trice, Stat Quo, Pitbull, Lil’ Jon and Lil’ Scrappy are also featured on the tour.

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Damon Dash Music Group's star rapper Beanie Sigel was released this morning (August 9) from a Federal Correctional Institution in Fairton, New Jersey.

Sigel was welcomed home by his mother, Michelle Brown-Derry, his fiancée Melissa and DDMG's Damon Dash and Kareem "Biggs" Burke.

Sigel entered prison on November 8 and was released after serving most of a one year sentence for gun possession charges.

Sigel was already tried for attempted murder last April, stemming from a July 2003 shooting outside of a Philadelphia, Pennsylvania bar.

A mistrial was declared when the jury could not reach a verdict.

Fans supported Sigel during his stint behind bars. His latest release The B. Coming debuted at #3 on Billboard's Top 200 Album Chart, the highest of Sigel's career.

The album has moved over 300,000 copies since being released in March.

Sigel is immediately planning a tour to support The B. Coming and he will also drop a DVD August 23rd.

The DVD will include personal commentary from Sigel himself, BET's uncut three part special "The Truth", "The Trial" and "House Arrest", the "Feel It In The Air" video and never before seen concert footage from a performance at club Exit in New York City.