Accountant Sentenced for Real Estate Ponzi Scam

Allison Tussey —  January 22, 2013 — 1 Comment

Alan Ritter, 70, Monsey, New York, a self-employed accountant in Rockland County, New York, was sentenced in Manhattan federal court to three years in prison in connection with his operation of an 11-year, $6 million Ponzi scheme for defrauding investors by falsely telling them that he intended to use the money to invest in real estate ventures.

Ritter pled guilty to three counts of wire fraud in September 2012 before U.S. Magistrate Judge Debra Freeman. U.S. District Judge Paul A. Crotty imposed the sentence.

According to the Information and statements made during the plea proceeding:

Ritter operated his own accounting practice in Rockland County, New York. In 2001, he suffered more than $500,000 in losses from an unrelated business venture. In order to cover those losses, Ritter solicited hundreds of thousands of dollars in loans from friends and clients of his accounting practice, falsely telling them that he intended to use the money to invest in real estate ventures. For the next 11 years, Ritter operated a Ponzi scheme in which he borrowed more and more money for purported business ventures that he used the money to cover the interest payments on the original loans he secured, and to pay for his own personal expenses.

Ritter also embezzled funds entrusted to him by several clients, using their money to cover the interest payments on the Ponzi scheme loans and to pay for his personal expenses. For example, in November 2011, Ritter was given $650,000 on behalf of a family and was instructed to use a portion of it to satisfy several of the family’s outstanding debts. The remainder of the funds was to be held pending further instructions. Instead, Ritter embezzled at least $530,000 of the original $650,000.

In addition to his sentence, Judge Crotty sentenced Ritter to three years of supervised release and ordered him to pay restitution and forfeiture, which will be determined at a later date.

Preet Bharara, the United States Attorney for the Southern District of New York, announced the sentence.

Manhattan U.S. Attorney Preet Bharara said: “Alan Ritter, like other Ponzi schemers before him, added personal betrayal to his fraud by fleecing unsuspecting victims who were friends and clients. He will now face the penalty for his conduct.”

Mr. Bharara praised the investigative work of the Criminal Investigators of the United States Attorney’s Office for the Southern District of New York.

This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force, on which Mr. Bharara serves as a Co-Chair of the Securities and Commodities Fraud Working Group. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorney Michael A. Levy is in charge of the prosecution.

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Allison Tussey

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One response to Accountant Sentenced for Real Estate Ponzi Scam

  1. People who does these type of fraud should be punished severely as i have been a victim of such person who took my money telling that they will invest in real state.

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