How LONG does it take to uncover *massive* fraud at a brokerage - SCARY!
nytimes.com
<<Brokerage Indicted in Stock Fraud
By The Associated Press
NEW YORK (AP) -- A Florida securities firm and 33 people have been
accused of committing massive stock fraud against thousands of investors
and cheating them out of almost $100 million.
Indictments announced Thursday in Manhattan allege that A.S. Goldmen
of Naples, Fla., and the individual defendants bilked investors by lying to
them, performing unauthorized trades, ignoring sell orders, forgery, and
outright theft.
Some investors, mostly elderly, were persuaded to get as much cash as
possible from their credit cards, or withdraw money from retirement
accounts, to invest with Goldmen. Virtually all of that money was lost.
District Attorney Robert Morgenthau said many people were irreparably
hurt. For example, a 73-year-old retiree who lost his life savings had to
return to work as a bus driver, Morgenthau said.
Morgenthau said Goldmen, which was started in 1988 and at its peak in
1994-95 had more than 300 brokers and 50,000 customer accounts in
Iselin, N.J., and Naples, Fla., was created to steal money from investors.
Morgenthau said the firm committed crimes in almost every area of the
securities business. He said they artificially drove stock prices up and
down, used insider information for trades, charged excessive markups on
stocks, used high-pressure tactics, lied, and used unlicensed salesmen.
Two defendants controlled Goldmen's activities, Morgenthau said. They
are Anthony Marchiano of Naples, Fla., Goldmen's president and sole
shareholder, and Stuart Winkler of Morganville, N.J., the firm's chief
financial officer.
Winkler is a former official of the National Association of Securities
Dealers, which regulates the securities industry, and therefore knew many
ways to help Goldmen hide its wrongdoing, Morgenthau said.
The indictment charges Goldmen with crimes from July 1994 to June
1998. Daniel Castleman, head of Morgenthau's Investigations Bureau,
said the statute of limitations bars charges for earlier crimes.
The defendants, all from New York, New Jersey, Connecticut or
Florida, are charged variously with enterprise corruption, grand larceny,
scheme to defraud, falsification of business records, money laundering,
and related crimes.
A.S. Goldmen is no longer in business, and the defendants, who are all in
custody, were unavailable for comment.
Morgenthau said his office has begun civil court proceedings to recover
$99,269,688 as the proceeds of the defendants' criminal acts.
A temporary restraining order prohibits the defendants from disposing of
any assets and directs banks and other institutions to freeze defendants'
assets, he said.>>
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