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Strategies & Market Trends : Anthony @ Equity Investigations, Dear Anthony, -- Ignore unavailable to you. Want to Upgrade?

To: Land Shark who wrote (66601)	2/2/2001 4:06:26 PM
From: StockDung	Read Replies (1) \| Respond to of 122087

All in the Family: Ex-NJ Broker Admits Scam, Turns on Brother Newark, New Jersey, Feb. 2 (Bloomberg) -- A broker at a defunct New Jersey securities firm has pleaded guilty to his role in defrauding customers of more than $100 million and has agreed to testify against his brother in an upcoming criminal trial. David Goettlich admitted in federal court Thursday that he helped his family-owned firm, First Interregional Advisors Corp. of Millburn, New Jersey, fraudulently sell office equipment leases in a pyramid scheme that lasted several years until 1997. Goettlich, 44, also pleaded guilty to helping a related securities firm, First Interregional Equity Corp., defraud customers by selling bonds or pledging them as collateral without the consent of customers. He admitted knowing that the firm fraudulently transferred millions of dollars through the bond manipulations to a third firm owned by his father, Herbert. ``Certain victims of the securities fraud conspiracy were selected on the ground that they were unusually vulnerable because of their age, their physical or mental condition, or their relationship with the family that controlled First Interregional,'' prosecutors said in court papers. In pleading guilty, Goettlich agreed to testify against his brother, Peter, 47, who is scheduled for trial March 20. A third brother, Richard, was among three other employees who pleaded guilty and are cooperating with prosecutors in their case against Peter Goettlich. U.S. District Judge William G. Bassler has said he will sever the father from the trial because he is suffering from Alzheimer's disease. Herbert Goettlich, who's now living in a nursing home, founded the firms in 1979 and ran them until they were raided by FBI agents in March 1997. Suits and a Backhoe Herbert Goettlich's attorney, Andrew Blair, said that the guilty plea and cooperation by David Goettlich will increase the pressure on Peter to plead guilty before the trial. ``I've had experiences where brothers and cousins have gone against each other, and it's never pleasant,'' Blair said. ``Once a brother testifies against another brother, he'd be a fool not to work out something with the U.S. Attorney's Office.'' Peter Goettlich's attorneys, Alan Zegas and Thomas Ashley, did not immediately return calls seeking comment. As part of his guilty plea, David Goettlich also admitted evading taxes and selling a $125,000 bond that was registered to a man who had died. Prosecutors said the Goettlichs evaded at least $3.8 million in taxes and drained more than $20 million from the firms to support luxurious lifestyles. The defendants and others allegedly bought $670,000 in men's suits and a backhoe for $21,335. Feb/02/2001 14:00 ET For more stories from Bloomberg News, click here. (C) Copyright 2001 Bloomberg L.P.