SHELTON RESIDENT SENTENCED TO THREE YEARS IN
FEDERAL PRISON FOR DEFRAUDING INVESTORS OF $307,000
David B. Fein, United States Attorney for the District of Connecticut, announced that JOHN H. GOLDSMITH, 58, of Shelton, was sentenced today by United States District Judge Stefan R. Underhill in Bridgeport to 36 months of imprisonment, followed by three years of supervised release, for defrauding investors of more than $300,000.
“Over the course of several years, this defendant defrauded family and friends of hundreds of thousands of dollars,” stated U.S. Attorney Fein. “This case should send an unequivocal message to fraudsters intent on victimizing others with false investment schemes: the U.S. Attorney’s Office and our Connecticut Securities, Commodities and Investor Fraud Task Force partners are committed to bringing you to justice. It should also serve as a caution to the investing public to consider carefully where to place your savings or retirement funds.”
According to court documents and statements made in court, between approximately 2005 and 2010, GOLDSMITH devised and executed a scheme by which he solicited investments from victims, including family members and friends, in various nonexistent companies. In one instance, GOLDSMITH falsely claimed that some of the investments were to be used to purchase stock in a publicly traded company at discounted rates. In another scheme, GOLDSMITH falsely claimed that invested funds were to be used to set up a video-sharing website. Through these schemes, GOLDSMITH defrauded investors of approximately $307,000 by converting a significant portion of invested funds to his own personal use. GOLDSMITH concealed his activities by fabricating checks and bank records and by using one investor’s funds to partially repay another victim.
One of GOLDSMITH’s victims was a close friend who depleted a home equity line of credit and liquidated stocks in order to invest more than $142,000 in GOLDSMITH’s schemes. In a letter to the court, the victim’s wife wrote that GOLDSMITH “has destroyed our present lives - we are different people now. We don’t trust anyone. We don’t enjoy any activities we used to, can’t even afford an occasional movie! We are financially homebound. And he has destroyed our financial future.… Goldsmith first took our nest egg. Then he continued to encourage [the victim], his ‘best’ friend, to obtain more money from our home equity account, knowing all the while he was putting us in debt, and spending our money on his own living expenses and luxuries.”
On February 27, 2012, GOLDSMITH pleaded guilty to one count of securities fraud.
This matter was investigated by the Federal Bureau of Investigation and the Connecticut Securities, Commodities and Investor Fraud Task Force. The case is being prosecuted by Assistant United States Attorney Liam Brennan.
The Connecticut Securities, Commodities and Investor Fraud Task Force investigates matters relating to insider trading, market manipulation, Ponzi schemes, investor fraud, financial statement fraud, violations of the Foreign Corrupt Practices Act, and embezzlement. The Task Force includes representatives from the U.S. Attorney’s Office; Federal Bureau of Investigation; Internal Revenue Service – Criminal Investigation; U.S. Secret Service; U.S. Postal Inspection Service; U.S. Department of Justice’s Criminal Division, Fraud Section and Antitrust Division; U.S. Securities and Exchange Commission (SEC); U.S. Commodity Futures Trading Commission (CFTC); Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP); Office of the Chief State’s Attorney; State of Connecticut Department of Banking; Greenwich Police Department and Stamford Police Department.
Citizens are encouraged to report any financial fraud schemes by calling, toll free, 855-236-9740, or by sending an email to firstname.lastname@example.org.
This case was brought in coordination with the President’s Financial Fraud Enforcement Task Force, which was established to wage an aggressive and coordinated effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
To report financial fraud crimes, and to learn more about the President’s Financial Fraud Enforcement Task Force, please visit www.stopfraud.gov.
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