News

Financial Advisor Pleads Guilty to Defrauding Client Volunteer Fire Department

FOR IMMEDIATE RELEASE
August 19, 2008

Greenbelt, Maryland - Jose Daniel Iriarte, age 36, of Severn, Maryland, pleaded guilty today to wire fraud arising from a scheme to defraud a client-volunteer fire department of $130,000, announced United States Attorney for the District of Maryland Rod J. Rosenstein.

According to the plea agreement, Iriarte was a financial advisor at the Bethesda office of a financial services brokerage firm, responsible for providing investment advice and services to financial customers. In October 2006, Iriarte listed his townhouse in Crofton, Maryland for sale. At around the same time, he entered into a contract to purchase a more expensive residence in Severn, Maryland. Iriarte planned to use the equity from the sale of the townhouse to finance the Severn residence.

By November 2006, the townhouse had not been sold and Iriarte needed money to make a down payment of the Severn residence. In order to make the down payment and to pay off some other debts, Iriarte obtained a short-term private loan from one of his investment clients. When the private loan became due in April 2007, however, Iriarte still had not sold the townhouse and did not have the funds to repay the private loan. Iriarte then took $130,000 that a volunteer fire department, which was another of his investment clients, had entrusted to him for investment and used those funds to repay his private loan. The fire department never authorized Iriarte to use its funds to repay Iriarte’s personal debt.

Iriarte faces a maximum sentence of 20 years in prison followed by three years of supervised release. U.S. District Judge Roger W. Titus has scheduled sentencing for November 25, 2008 at 9:00 a.m.

United States Attorney Rod J. Rosenstein thanked the Federal Bureau of Investigation for its investigative work and commended Assistant United States Attorney Kathleen O. Gavin, who is prosecuting the case.

 

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