Archives For investment fraud

Angelo Alleca, 46, Buffalo, New York, and Mark Morrow, 54, Cincinnati, Ohio, were arraigned on charges of orchestrating a multi-million dollar investment fraud scheme.  The Defendants marketed several funds that were supposed to invest in certain assets/investments, such as hedge funds managed by a professional money manager of mortgage debt.  According to the new indictment, they instead used the money to pay redemptions to earlier investors, to acquire and operate several businesses, and to pay personal expenses.

According to U.S. Attorney John Horn, the indictment, and other information presented in court: From on or about 2004 until 2012,  Alleca acted as the President and Chief Operating Officer of Summit Wealth Management, an investment adviser headquartered in Atlanta, Georgia. During that time, Alleca started several funds and falsely misrepresented that money would be invested in hedge funds and debt securities and managed by professional investment managers. Continue Reading…

Daniel J. Flynn, III, 52, Milton, Massachusetts, was arrested and charged in U.S. District in Boston with wire fraud.  According to the criminal complaint, Flynn defrauded investors of millions in a real estate investment scheme that began in at least 2007.

The complaint details several aspects of the alleged scheme, including that Flynn falsified the value of his real estate investment fund by creating fraudulent promissory notes purportedly worth millions and representing to investors that they were legitimate debts that were owed to Flynn’s real estate investment fund.  Second, the complaint alleges that Flynn repeatedly induced investors to loan him money to purchase specific pieces of property that, in some cases, Flynn already owned.  It is further alleged that Flynn often used investor’s money to pay his personal debts and to repay prior investors.  Once investors uncovered Flynn’s fraudulent activities, Flynn changed the name of his business and created similar entities through the names of third parties in an effort to conceal his fraudulent activities.

The charging statute provides a sentence of no greater than 20 years in prison, three years of supervised release, and a fine of up to $250,000.  Actual sentences for federal crimes are typically less than the maximum penalties.  Sentences are imposed by a federal district court judge based on the U.S. Sentencing Guidelines and other statutory factors.

United States Attorney Carmen M. Ortiz and Vincent B. Lisi, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division, made the announcement.  The case is being prosecuted by Assistant U.S. Attorney Neil J. Gallagher, Jr. of Ortiz’s Economic Crimes Unit.