Two Fast Food Restaurant Workers are Accused of Impersonating SEC Employees
Frank Gregory Cedeno and Leonel Alexis Valerio Santana, two employees at a Florida restaurant, are accused of pretending to be SEC employees who tried to get at least 95 investors to give pay them $1.3M. The men are charged with wire fraud and conspiracy.
According to the criminal complaint, Cedeno and Santana targeted investors of binary options, in particular those that bought them from Banc de Binary and other entities that had been the subject of lawsuits brought by US regulators. For example,in 2016, Banc de Binary settled with the SEC and the CFTC for $11M allegations that they illegally solicited US investors via its trading platform. But even as early as the year before that, prosecutors contend, Banc de Binary securities buyers began receiving calls and emails from supposed SEC employees wanting money related to these investments. Investor targets were purportedly told that they would have to pay money to get part of the Banc de Binary settlement. More than two dozen people reportedly gave the scammers over $235,000 collectively.
Chicago Investment Adviser Arrives at Plea Agreement in Senior Fraud Case
Daniel Glick, a former investment advisor, has pleaded guilty to wire fraud. Per the plea deal, Glick bilked clients of at least $5.2M and lied to them about their money. The majority of his victims were older investors, including his in-laws and a nursing home resident.
Last year, the SEC filed an emergency action against Glick and his Financial Management Strategies, which was an unregistered firm, in a parallel senior fraud civil case. The regulator accused Glick of using client money to pay for his own expenses, including a Mercedes, cover business costs, and repay debts and loans.
The Financial Industry Regulatory Authority had barred Glick in 2014, and his CPA license and Certified Financial Planner designation were previously revoked over conduct separate from what the SEC and prosecutors are now contending.
First Farmers Financial LLC CEO Who Pleaded Guilty in $179M Investment Fraud Tried to Flee the US
Nikesh Patel, who was awaiting his prison sentence for five counts of wire fraud, was arrested earlier this month while trying to flee the US in a private jet for Ecuador. Patel, formerly First Farmers Financial LLC’s CEO, had pleaded guilty to the criminal charges in 2016. He admitted to selling tens of millions of dollars in fraudulent loans-26 of them-to Pennant Management and spending the money on his own extravagant lifestyle and to purchase hotels.
The fraud caused the Illinois Metropolitan Investment Fund, which invested with Pennant, to lose over $50M. According to the Chicago Tribune, over 200 Chicago-area park districts, school districts, municipalities, and other public entities that invested tax money with the fund were affected by Patel’s fraud.
U.S. Charges Two Over Fraud Featuring Bogus SEC Employees, USNews/Reuters, January 23, 2018
Operator of Investment Scheme Involving Seniors Pleads Guilty, SEC, January 22, 2018
Florida CEO, Awaiting Investment Fraud Sentencing, Arrested Attempting to Flee Country, IndiaWest, January 12, 2018
More Blog Posts:
CFTC and Massachusetts Regulator Accuse Bitcoin and Cryptocurrency Operators of Selling Unregistered Securities, Stockbroker Fraud Blog, January 22, 2018
FINRA Orders Citigroup to Pay $11.5M, Including at Least $6M to Investors, Over Inaccurate Stock Research Ratings, Stockbroker Fraud Blog, December 29, 2017
SEC Orders Wells Fargo Advisors to Pay $3.5M Penalty, Institutional Investor Securities Blog, November 13, 2017