Re: 5/1/00 - 2 former A.S. Goldmen brokers plead guilty
2 former A.S. Goldmen brokers plead guilty
Saturday, May 13, 2000
By GINA EDWARDS, Staff Writer
Two former A.S. Goldmen & Co. stockbrokers pleaded guilty Friday to reduced stock fraud charges arising from their employment at the Naples-owned firm that prosecutors say bilked investors around the country out of $100 million.
Christopher Brand and Paul Colontino were both allowed to plead to reduced charges under separate deals reached with prosecutors in the Manhattan District Attorney's Office in exchange for lighter sentences than had they gone to trial and been convicted.
Brand worked at A.S. Goldmen's Naples office from July 1997 to April 1998, and Colontino worked in the firm's Iselin, N.J., office.
Brand pleaded guilty to one count of attempted scheme to defraud and was sentenced to one year in prison by Manhattan Judge Leslie Crocker Snyder on Friday. He initially was charged with one count of grand larceny and five counts of securities fraud. He also was charged with attempted grand larceny.
Colontino pleaded guilty to enterprise corruption and faces between one and three years in prison at his sentencing July 7. In exchange for his plea, two counts of grand larceny, five counts of stock fraud, and six counts involving falsifying business records were dropped.
In July 1999, a Manhattan grand jury indicted A.S. Goldmen owner Anthony Marchiano, a Gordon Drive resident, and 33 others, charging them with a range of securities crimes including a "pump and dump" stock scheme involving Stadium Naples, a golf spectator arena development that was never built.
Brand was indicted in July, but didn't appear in court in Manhattan until March following a lengthy extradition effort to retrieve him from his hometown in Swindon, England.
A total of 11 employees of Goldmen's Naples office have been charged as part of the New York case. Two Naples brokers were charged in 1998.
Brand is the second Naples broker to plead guilty. Michael Lamarti pleaded guilty last year to attempted enterprise corruption but has yet to be sentenced. A total of four Goldmen brokers have now pleaded guilty.
Prosecutors say Marchiano ran a corrupt enterprise that bilked thousands of investors out of nearly $100 million. If convicted of enterprise corruption under New York's Organized Crime and Control Act, Marchiano could face up to 25 years in prison.
Marchiano, 38, has denied wrongdoing. He's expected to go on trial in Manhattan in the fall.
A.S. Goldmen held itself out as a legitimate firm, but systematically broke securities laws and regulations to steal from unsuspecting customers, prosecutors say. The firm is accused of manipulating the stocks of 10 small companies, among them Millennium Sports Management Inc., a partner in Stadium Naples.
Here's how prosecutors say the fraud worked:
A.S. Goldmen acquired millions of shares of Millennium Sports Management Inc. at discounted rates. The firm's boiler room of brokers then made gross misrepresentations to customers about the golf stadium to hype Millennium stock and sell shares to unwitting customers.
For example, prosecutors say some brokers told telephone customers they could see the North Naples golf stadium under construction from their Fifth Avenue South office. In fact, Stadium Naples ? slated for land next to Interstate 75 ? never got off the ground.
At the time, brokers failed to tell customers that Stadium Naples had collapsed once before and was the subject of the bribery investigation involving Collier County Commissioner John Norris, prosecutors say.
Last year, Gov. Jeb Bush asked federal prosecutors to reopen that Collier criminal bribery probe that resulted in no charges. Florida state investigators found that State Attorney Joe D'Alessandro bought stock in Millennium during his Stadium Naples probe from brokers at A.S. Goldmen. D'Alessandro has said the stock purchases didn't affect his probe.
Brand, 33, swindled Millennium investors including a 75-year-old widower on a fixed income and residents in Georgia and Brooklyn, Manhattan prosecutors said in March.
Millennium stock, which traded on the NASDAQ under the symbol MSPT, is virtually worthless today.
Colontino, 30, admitted lying to customers, scheming to control share prices, falsifying business records and refusing to let customers sell shares, prosecutors say.
He made specific reference in his guilty plea to Innovative Tech Systems Inc. and Wanderlust Interactive Inc., stocks Goldmen took public in initial offerings in 1994 and 1996, respectively.
Colontino also admitted paying an impostor to take his broker licensing exam and trading stocks through a dummy account in his wife's maiden name.
Copyright ¸ 2000 Naples Daily News. All rights reserved.
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