Ponzi Scheme

Louis Gallo, former vice president of Commodities Online LLC, a Florida-based investment company, was sentenced last week to fourteen years imprisonment and ordered to pay nearly $20 million in restitution for his participation in a $21 million invest fraud. Gallo's sentence will additionally include three years of supervised release after he is released from prison. Finally, he will have to forfeit a criminal money judgment of $21.6 million as well as his interest in a car, two bank accounts, and three properties. Gallo pleaded guilty in August to one count of conspiracy to commit mail and wire fraud. From January 2010 to April 2011, Gallo allegedly conned over 700 investors out of $21 million. James C. Howard III, Commodities Online's co-founder, had already pleaded guilty to his role in the scheme and was sentenced to fifteen years and nine months and forced to pay $18.9 million in restitution. Rita E. Balbirer received twenty-one months on a money laundering charge. Patricia [...]

Richard L. Pearson, a broker affiliated with Rothstein Rosenfeldt Adler PA and alleged to have played a role in Scott Rothstein's $1.2 billion Ponzi scheme, pleaded guilty in Florida federal court to a wire fraud charge, noting that he contributed to investors losing $2.4 million. Pearson and Rothstein Rosenfeldt Adler attorney David Boden had each been charged with one count of conspiracy to commit wire fraud, admitting that they received commissions directly from a group investing in Rothstein's scheme without informing the investors that Rothstein paid them an additional commission. Federal authorities plan to show, if the case goes to trial, that the group invested roughly $3.3 million with Rothstein, paying a commission directly to Pearson who also received a commission from Rothstein. In sum, the investors were allegedly scammed out of $2.4 million because of Boden and Pearson's misrepresentations and omissions. Pearson will face a maximum of five years imprisonment and could be ordered to pay as much as [...]