Investor Fraud: Investment Adviser Pleads Guilty to Retirement Fund Fraud, Stock Research Firm is Sued in Alleged Pump-and-Dump Scam That Targeted Seniors, and A Rabbi is Accused of Running a $35M Ponzi Scam

Investment Adviser Accused of Lying to Retirement Fund Clients Pleads Guilty

Richard G. Cody, an investment adviser who ran Boston Investment Partners and is accused of lying to clients about how he handled their retirement funds, has revised his not guilty plea. Cody is now pleading guilty to both making a false declaration under oath and investment adviser fraud.

According to The U.S. Attorney’s Office for the District of Massachusetts, Cody allegedly lied to at least three investors who had relied on him to manage their retirement savings. The investment adviser is accused of fabricating documents so it would look as if their funds were still in the accounts even though hundreds of thousands of dollars had disappeared.

The criminal indictment notes that one investor purportedly thought he had $489K in savings when the actual balance was $43. Cody is accused of sending another investor a bogus tax form to make it appear as if the money she wanted to withdraw from her retirement funds would come in the form of an annuity through Sun Life Financial.

The US Securities and Exchange Commission (SEC) had filed parallel civil charges against Cody and Boston Investment Partners. He was also subject of a Financial Industry Regulatory Authority complaint in 2008 accusing him of excessive trading and unsuitable trading in clients’ accounts. In 2013, FINRA gave him a 1-year suspension that he did not tell the investors impacted in this case latest about.

Cody was previously registered with Salomon Smith Barney and Merrill Lynch Pierce, Fenner & Smith Inc.

Elite Stock Research Sued in Alleged $3.3M Boiler Room Fraud

The SEC is once again suing Elite Stock Research for investor fraud in alleged pump-and-dump fraud. The stock research firm and five people are accused of running a $3.3M boiler room scam that targeted older, unsophisticated investors who were aggressively solicited by phone to purchase shares of First Choice Health Care Solutions, Inc. The alleged scheme reportedly led to over $3.3M in illegal profits and more than $560K in kickbacks for First Choice CEO Christian Romandetti.

According to the regulator’s complaint, over 100 investors purchased the shares. In pump-and dump-fashion, the shares, whose prices were artificially raised and then later dumped after there had been enough of investor demand and resulting sales, caused the fraudsters to make millions of dollars in “illegal proceeds.”

Also facing civil charges are Elite Stock CEO Anthony Vassallo, Romandetti, Mark Burnett, Jeffrey Miller, and Frank Sarro. The five of them, along with Elite Stock and several other individuals, were previously charged in another alleged boiler room fraud involving penny stocks. That scam allegedly bilked investors of over $10M.

Chicago Rabbi Accused of Abusing His Position in Jewish Community

Tzvi Feiner, a Chicago rabbi, is accused of bilking investors in a $35M Ponzi scam in which he allegedly solicited investors via questionable real estate deals. His alleged victims are said to include a 90-year-old Holocaust survivor and Jewish day school teachers.

According to the criminal complaint, Feiner kept the money he made from selling real estate acquisitions and reneged on his promise to investors that they would make huge returns on their investments. The alleged Ponzi scam went on for five years, and newer investors’ money was used to pay older investors.

At least three investor fraud lawsuits have been filed against Feiner, two of which he settled. According to court records, two investors that Feiner settled with claimed that they were cheated of $25M.

At Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm), our investor fraud lawyers are here to help you explore your legal options. Your first call with us is a free, no obligation case consultation. Contact SSEK Law Firm today.

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