Last edited on Friday, December 03, 2021, at 12:42 PM.
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Friday, December 03, 2021
Financial Issues Dominate the New York Criminal Courts
In the first case we look at this week, on Nov. 29, Gonzalo Ortiz, 48, of Hackensack, NJ, appeared in federal court in Brooklyn, where he pled guilty to charges of investment adviser fraud. He faced these charges because Ortiz would first solicit investment money from his clients and then turn around and steal the investment money for his own personal use. In all, Ortiz defrauded at least one investor of about $600,000 by making false representations about his trading expertise and the profitability of various investments. The proceeding was held before United States District Judge William F. Kuntz, II.
According to the charging documents in this case, between April 2015 and May 2017, Ortiz falsely represented himself to at least one investor as a successful investment adviser who had made profits for other individuals by trading stocks on their behalf. Ortiz was able to convince his victim to allow him to invest the Victim’s money, promising significant returns. Based on the misrepresentations, the Victim made several additional investments with Ortiz over several years.
Cryptocurrency Trader Pleads Guilty
Investment fraud wasn’t the only type of criminal fraud in the New York Criminal Courts over the past week. On Nov. 30, another case emerged, this time against cryptocurrency trader, Jeremy Spence, a/k/a, “Coin Signals,” after he managed to solicit more than $5 million from at least 170 investors. Spence pled guilty to commodities fraud Nov. 30, to U.S. Magistrate Judge Debra Freeman.
In the process, Spence admitted to luring investors to his cryptocurrency investment scheme, in which he touted historical returns that were fictional. The real picture was one in which Spence’s cryptocurrency investments routinely los money. In fact, it is estimated that investors in this scheme lost at least $5 million. Spence now faces up to ten years in federal prison.
According to the indictment and complaint filed in this case, from November 2017 through April 2019, Spence solicited investors in various cryptocurrency investment pools that he had created and managed the cryptocurrency fund at the source of this. The largest and most active of these funds included the Coin Signals Bitmex Fund, the Coin Signals Alternative Fund, and the Coin Signals Long Term Fund. Investors who wanted to participate in a Fund would transfer cryptocurrency, such as Bitcoin and Ethereum, to Spence so that Spence could invest it.
NY Criminal Courts Also Deal with Plain Investment Fraud
There was also a case this past week involving a defendant engaged in plain old investment fraud. In this case, the named defendant claimed to be the CEO of an alleged Global Biomedical Company who made false claims of investment opportunities. The indictment was announced November 30 by the U.S. Attorney for the Southern District of New York, Damian Williams, along with Ricky J. Patel, the Acting Special Agent-in-Charge of the New York Field Office of the Department of Homeland Security Investigations (HSI).
The indictment charges Norman Gray, the CEO of the Biomedical Company, which is headquartered and incorporated in Hamden, Connecticut, with wire fraud, in connection with a scheme to induce at least one individual into wiring him funds through false promises that those funds would be put towards an equity stake in his purported global biomedical company (“Biomedical Company”) and certain purported investment deals involving the sale of personal protective equipment (PPE).
Violation of Data Security Laws
In yet another case that saw its debut this week, on Dec. 1, the U.S. Attorney for the Southern District of New York, Damian Williams, and the Assistant Director-in-Charge of the FBI’s New York Office, Michael J. Driscoll, announced he arrest of Nickolas Sharp for secretly stealing gigabytes of confidential files from a New York-based technology company where he was employed.
That wasn’t the end of it, though. While he was supposedly trying to fix the security breach, Sharp then extorted the company for almost $2 million for the return of the files and the identifications of a claimed vulnerability. Sharp then doubled down by publishing misleading news articles regarding the company’s handling of the problem he initiated with his hacking activities.