STOCKBROKERS ACCUSED OF CHEATING INVESTORS - May 13, 1997
ÿNEW YORK (Reuter) - Thirteen stockbrokers and an investment firm were accused Tuesday of cheating investors out of more than $75 million.
ÿ The now-defunct A.R. Baron & Co. and 13 of its executives were charged in a 174-count indictment with lying to investors to induce them to buy certain securities, manipulating markets to benefit themselves and making unauthorized trades.
ÿ They also were accused of refusing to follow customer instructions to sell securities, outright thefts from investors, ignoring or inducing clients to retract complaints and forging documents to prevent discovery of their crimes.
ÿ More than 45 investors were bilked out of millions of dollars, said Robert Morgenthau, Manhattan district attorney. The company dealt with about 8,000 investors.
ÿ "Today's indictment depicts an investment firm totally out of control," Morgenthau said. "A.R. Baron was created and existed for no other reason than to line the pockets of its executives ... at the expense of ... the investing public."
ÿ The ten-month investigation began after Parsons & Whittemore Ltd., a Rye, New York, privately owned firm that lost at least $2 million, complained to authorities, he said. Regulators shut the firm down in July 1996.
ÿ Other victims included New York University, which lost more than $600,000; Anthony Pilkington of Manchester, England, whose family owns a huge glass-making company and who was bilked out of at least $500,000; and Hong Kong businessman Keith Hsu, who lost more than $1 million, Morgenthau said.
ÿ The prosecutor said some of the money allegedly stolen from investors went into a Cook Island trust in the Pacific, Swiss bank accounts and the brokers' personal lifestyles.
ÿ The defendants are charged with enterprise corruption and grand larceny. If convicted, they face up to 25 years in prison and millions of dollars in fines. |
