Ex-broker guilty of mail fraud
By Rob Seman, Daily Record
03/06/03 - Posted 11:23:13 PM from the Daily Record newsroom
A former securities broker who operated with Seaboard Securities in Florham Park pleaded guilty in U.S. District Court on Wednesday to mail fraud and a scheme to bilk clients out of more than $350,000.
Louis Romano, 59, of Madison, admitted that he devised a scheme to take customer funds supposedly earmarked for legitimate stock and bond investments and divert them for his own personal use. Romano admitted he diverted about $350,000.
Romano was indicted in October on two counts of mail fraud and pleaded guilty to one count on Wednesday. The other count was dropped as part of the plea agreement.
"After a careful evaluation of the evidence in the case, Mr. Romano made the decision that he should accept the responsibility for his conduct," said Romano's Morristown-based attorney, John Whipple.
Romano admitted he convinced customers to pay for supposed legitimate investments with personal checks made out to "cash" or to Romano himself.
Romano said he convinced other customers to sell their existing legitimate securities and turn over proceeds to him for further investment and falsely represented that the stocks and bonds he recommended were safe, high-yield opportunities for long-term investment.
Romano told his clients he would invest their money in Seaboard accounts and they would not receive monthly account statements, while in fact no investments ever were made.
In order to conceal his activity, Romano reassured customers and made periodic payments to a number of his customers .
Whipple said Romano was not a full-time broker with Seaboard Securities, and has not worked there for a few years.
The fate of Romano's license or ability to practice in the industry will be decided at his sentencing, scheduled for June 23. Romano faces a maximum penalty of five years in prison and a $250,000 fine. Romano has agreed to repay his victims. He is free on bail pending his sentencing.
"He certainly regrets what he did and will make every effort to make them (the customers) whole in the future," Whipple said.
Rob Seman can be reached at rseman@gannett.com or (973) 428-6631. |
