On June 19, 2018 the Securities and Exchange Commission filed charges against multiple individuals and associated companies that defrauded investors out of $102 million. The individuals charged are Perry Santillo, Christopher Parris, Paul LaRocco, John Piccarreto, and Thomas Brenner (collectively “Defendants”).
These individuals accrued client assets largely through buying the books of business of retiring brokers. This method of raising funds allowed the brokers to gain clients trust, by ingratiating themselves with older brokers who were retiring and inserting themselves into the relationship. The Defendants would then convince clients to liquidate safe investments and move funds into companies controlled by Defendants. These companies were represented as real estate development trusts, financial services entities, oil and gas operations, etc. and double-digit investment returns combined with high dividends were promised.
In reality, these companies were simply shell entities controlled by Defendants, and once funds were transferred into the entities, they were transferred to feeder accounts, comingled, and withdrawn and misappropriated by Defendants for personal use. Defendants preyed on elderly victims with Alzheimer’s and deteriorating health, and while building trust and promising the safekeeping of funds, brazenly stole them for personal use.
When Financial Advisors engage in fraud and criminal behavior and steal victim’s funds, often times the funds have been spent and are difficult to recover. In some instances, the custodian or clearing firm that was involved in holding client accounts for the entity that defrauded clients can be held liable for losses caused by the criminal activities of the Financial Advisor.
The attorneys at Lax & Neville LLP have extensive experience in successfully prosecuting claims on behalf of customers who have suffered losses as a result of investment and securities fraud. If you are a victim of fraud, please contact Lax & Neville LLP today at (212) 696-1999 to schedule a consultation.