Financial and Investment Fraud

March 16, 2016

A Thurston County judge ordered a California company that scammed new Washington property owners into buying overpriced deeds to pay more than $3.6 million, after granting summary judgment in a lawsuit brought by Attorney General’s office. The court found the Bellflower, Calif.-based LA Investors, LLC, which conducts business as “Local Records Office.” violated the state Consumer Protection Act at least 256,998 times by sending deceptive mailers. The company sent official-looking notices implying that consumers must buy a dramatically overpriced $89 copy of their deeds. Deeds typically cost only a few dollars from a local county office, and many property owners can obtain a copy of their deed for free online. WA

March 16, 2016

New Jersey announced that four individuals have been charged in connection with two separate schemes in which investors allegedly were defrauded of a total of $350,000 that they invested in purported medical ventures. In the first scheme, Joseph Denti Jr., Joseph Giardina and Heidi Francavilla allegedly stole $250,000 from a doctor by convincing him to advance that amount for a bogus investment involving a surgical center. They allegedly diverted his funds for their personal benefit. In the second scheme, Ralph Perricelli Jr. and Joseph Denti Jr. allegedly convinced a married couple to invest $100,000 in a blood-testing laboratory by falsely claiming to be joint owners of the lab. NJ

March 9, 2016

New Jersey announced that the owner of a now-defunct Bergen County used car dealership, D.I.B Leasing, along with three employees and a bookkeeper, have been charged with conspiracy, money laundering, and other offenses in connection with bank financing scam that allegedly netted $1.4 million in fraudulent loans for luxury cars. Prosecutors allege the defendants created fake employment records, inflated incomes, and supplied false pay stubs and fictitious employee verifications to dupe banks into approving auto financing for customers whose income levels did not qualify them for loans on the pricey vehicles. NJ

March 7, 2016

A Colorado-based telecommunications and Internet service provider company, Level 3 Communications, has agreed to pay more than $8 million to resolve allegations it improperly withheld rental payments to the Massachusetts Department of Transportation (“MassDOT”) under an agreement that allows it to run fiber optic cables alongside state highways. The settlement agreement resolves allegations that Level 3 Communications breached its contract with MassDOT and violated the Massachusetts False Claims Act by concealing the amount it owed the state agency and knowingly avoiding its annual rent obligations. MA

February 23, 2016

Las Vegas resident Joseph Micelli was sentenced to 60 months in prison and to pay $5.65 million in restitution and to forfeit $505,220 in fraudulent proceeds for his role in an investment fraud scheme that promoted fraudulent investment opportunities and caused more than $5 million in losses to investors.  Micelli admitted he conspired with others in the U.S. and Switzerland to promote investments and loan instruments he knew to be fraudulent.  They did so through a Swiss company known as the Malom Group A.G.  Micelli further admitted he held himself out to investors as an attorney, when in fact he had lost his license to practice law.  DOJ

February 24, 2016

New York, together with 21 other states, announced multimillion dollar settlements with Natixis Funding Corp. and Societe Generale for fraudulent and anticompetitive conduct in municipal bond derivative transactions with state and local government entities and nonprofits across the country. Natixis and Societe Generale will pay $29,950,000 and $26,750,000 respectively as part of a coordinated 22-state and private class settlement. Pursuant to the settlements, $53,865,000 will be paid into a Settlement Fund and largely applied to restitution for municipalities, counties, government agencies, school districts and nonprofits that the states allege were harmed when they entered into municipal derivatives contracts with Natixis or Societe Generale. NY, NJ, FL