Advisor stole $300K from 88-year-old woman in a nursing home, DoJ says
An advisor defrauded at least nine clients out of $1 million, including misappropriating $300,000 from an 88-year-old woman, to pay for tuition and mortgage payments, according to federal prosecutors.
Leon Vaccarelli, 41, was charged with fraud and money laundering offenses in a 12-count indictment in federal court in Connecticut. The charges could land the former advisor behind bars for a maximum of 210 years.
Between approximately 2011 and 2017, Vaccarelli told clients he would invest their funds in retirement products including IRA rollover accounts, money market accounts and other types of interest-earning investments, federal prosecutors say. Instead, the money was deposited into his personal account and used to pay business and personal expenses and sometimes made bogus “interest payments” to other investors, say federal prosecutors.
The charges include three counts of mail fraud, six counts of wire fraud and three counts of money laundering. Vaccarelli pleaded not guilty and was released on a $100,000 bond.
The SEC also brought related civil charges against Vaccarelli in parallel proceedings last year.
When he needed to repay another client about $60,000, Vaccarelli deposited $300,000 from an 88-year-old woman into a bank account he controlled instead of the client's account, according to the complaint brought by the SEC in August. The elderly woman, who got the money from selling her condo and was living in a nursing home at the time, never agreed to change her investments without the input of her daughter and son-in-law, who is an attorney, court documents show.
Vaccarelli’s lawyer Jonathon Einhorn said his client will be “vigorously opposing” the criminal case.
“We believe the SEC's civil action against Mr. Vaccarelli resolved any issues and do not see his conduct as the basis for a criminal conviction,” Einhorn said in a statement.
Vaccarelli did not return a request for comment.
He was previously affiliated with The Investment Center, an independent broker-dealer, during the period of the alleged fraud, according to FINRA BrokerCheck. The broker-dealer discharged Vaccarelli in July for failing "to comply with company policy regarding access to his office and computer during an examination," according to a resolved dispute in his BrokerCheck record.
“Since being made aware of the situation with Mr. Vaccarelli, we have been cooperating fully with the SEC’s investigation,” The Investment Center’s CEO, Ralph DeVito, said in a statement after the SEC charges were brought down in August. “We are outraged by Mr. Vaccarelli’s alleged behavior and continue to investigate the matter internally in order to aid ongoing investigations.”
The Investment Center did not return requests for comment on the latest charges.