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Former CEO of Beverly Company Sentenced to Five Years in Prison for Conspiring to Commit Securities Fraud and Other Crimes
June 15, 2012

BOSTON - A Marblehead man was sentenced yesterday in federal court for conspiring to commit securities fraud, defraud company auditors, make false statements in filings with the U.S. Securities & Exchange Commission (SEC), and commit aggravated identity theft.

Jon R. Latorella, 48, was sentenced by U.S. District Judge Douglas P. Woodlock to five years in prison, to be followed by three years of supervised release and the payment of restitution to his victims. Latorella pleaded guilty on March 5, 2012.

Had the case proceeded to trial, the Government’s evidence would have proven that, starting in about 2001, Latorella, the former President and CEO of Locateplus Holdings Corporation, and another man who worked at Locateplus, pursued several fraudulent schemes to artificially inflate the company’s assets and revenues, including:

• Fabricating a loan transaction with a fake company called Andover Secure Resources, which included using the identity of a man who died in 1985 as the head of Andover, and manipulating funds to create the appearance that Andover was paying down a fictitious debt to Locateplus;

• Falsifying revenue streams to make it appear that another entity, Omni Data Services, was paying Locateplus under the terms of a contract, when in fact Omni Data had no independent existence and the contract was fake;

• Deceiving the SEC and other regulatory authorities to avoid registering securities being sold by a company called Paradigm Tactical Products, including using the identities of Latorella’s acquaintances, girlfriends and two dead men as Paradigm investors;

• Routinely deceiving company auditors, and the SEC, about the nature of Locateplus’s revenues and assets in order to keep these fraudulent schemes going and to attract investment in Locateplus.

United States Attorney Carmen M. Ortiz, William P. Offord, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston and Richard DesLauriers, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division made the announcement today. The U.S. Attorney’s Office also acknowledges the valuable assistance it received from the U.S. Securities & Exchange Commission - Boston Regional Office.

The case was prosecuted by Assistant U.S. Attorneys Andrew E. Lelling and Paul G. Levenson of Ortiz’s Economic Crimes Unit.


 

 

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