As a follow up to an earlier post, the Manhattan District Attorney’s Office has announced that 17 individuals who worked at a now defunct securities firm have been indicted by a New York County Grand Jury for allegedly operating a racketeering scheme that scammed over six million dollars in unlawful commissions. The Manhattan Grand Jury indicted the defendants on the charges of Enterprise Corruption, Grand Larceny, Criminal Possession of Stolen Property, Securities Fraud and Falsifying Business Records. As a former Manhattan prosecutor who has supervised prosecutions of numerous multi-million dollar fraud schemes including a two million dollar “pump and dump” scheme with the Securities and Exchange Commission as well as a NY white collar criminal defense attorney who has represented individuals accused of multi-million dollar fraud crimes, I can say with confidence that these defendants and their criminal defense attorneys have a long road ahead of them.
The The Grand Jury indicted 17 defendants. Among them are Joseph Stevens & Company, Inc., Joseph Sorbara, Steven Mrakowiz, Craig Shapiro, John, Moraitis, Massimo Martinucci, Peter Orthos, Alan Ferraro, Charles Raspa, Scott Tierney, John Micciola, Steven Scarcella, Michael Tripodi, Douglas Costabile, James Rathgeber, Matthew Menies and Haradjin Mucovic. Because each of the defendants are charged with the top count crime of Enterprise Corruption, they all face a minimum of one to three years if convicted and a maximum of eight and one third to twenty five years in prison.
According to the Manhattan District Attorney’s Office:
“[T]he defendants defrauded 800 victims in more than 5,000 trades valued at $151,286,804.44. By manipulating the market value of carefully selected stocks, the defendants generated more than $6.2 million in unlawful, undisclosed commissions, in violation of New York law and the trust of their customers.” Furthermore, “[t]he investigation further revealed that the defendants repeatedly worked to capture undisclosed compensation while trading stocks, often by manipulating the stock price higher after having pre-arranged orders from their customers. In some cases, the stocks the customers purchased on defendants’ recommendations lost significant value in the days and months following the transactions.”
As this case unfolds it will be interesting to see what defense each of these individuals set forth. Was there an “ascertainable structure” in their crew as required under Enterprise Corruption? Do any of the affirmative defenses to Falsifying Business Records apply in this case? Whatever the defense may be, it is imperative that these defendants assess the case and implement their plan of action. Even a small delay could be fatal to their defense. If you or a loved one find yourself accused or investigated for any white collar crime, contact the former Manhattan prosecutors at Saland Law PC so that we can fight to preserve your liberty, rights and integrity.