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Justice News

Department of Justice
U.S. Attorney’s Office
Eastern District of New York

FOR IMMEDIATE RELEASE
Tuesday, December 20, 2016

Former Owner And President Of Unregistered Broker-Dealer Indicted In A $9 Million Securities Fraud Scheme

Defendants Directed The Use Of Aggressive Boiler Room Tactics To Target Investors Throughout The United States

BROOKLYN, N.Y. – John Desantis, a New York resident, and Dwayne Malloy, a New Jersey resident, the former owner and president, respectively, of Premier Links, Inc. (Premier Links), a Staten Island-based company, were arrested today on charges of securities fraud and wire fraud.  From approximately 2005 to 2012, Desantis and Malloy operated Premier Links as an unregistered broker-dealer, and through it stole more than $9 million from more than 300 investors in approximately 40 states.[1]  The defendants are scheduled to be arraigned before United States Magistrate Judge Lois Bloom, at the United States Courthouse, 225 Cadman Plaza East, Brooklyn, New York.

The charges were announced by Robert L. Capers, United States Attorney for the Eastern District of New York, and William F. Sweeney, Jr., Assistant Director-in-Charge of the Federal Bureau of Investigation, New York Field Office (FBI).

“As alleged, the defendants preyed on unsuspecting investors and stole their money after conning the investors into buying shares of worthless companies.  Now, their day of reckoning has arrived,” stated United States Attorney Capers.  “Today’s arrests demonstrate this Office’s continuing commitment to protecting the investing public from those who seek to swindle investors for personal gain.”   Mr. Capers extended his appreciation to the Federal Bureau of Investigation, the agency responsible for leading the government’s investigation, and thanked the U.S. Securities and Exchange Commission (SEC) for its assistance and cooperation during the investigation.

“As alleged, John Desantis and Dwayne Malloy operated an unregistered broker-dealer operation that preyed on innocent investors who were targeted in a boiler-room style investment scheme to invest in securities and promised big returns.  Instead, Desantis and Mallory used the investors’ money for their own pocketbook to the tune of $9.3 million.  Ensuring that all investors have factual information and our markets are fair is exactly why the FBI continues to investigate and bring those to justice who perpetrate securities fraud schemes,” stated FBI Assistant Director-in-Charge Sweeney.

According to the superseding indictment unsealed this morning and other documents filed publicly in the case, Premier Links operated from a Staten Island office and purported to sell stock to investors.  However, the defendants and others at Premier Links were never registered as broker-dealers with the SEC.  Instead, Premier Links operated as a “boiler room,” using “cold callers” and other means to entice victims into investing their money in securities with promises of outsized returns.  The defendants located their victims by using a printed list, which one of the defendants referred to as “the suckers list.”  Once the victims wired or mailed money to Premier Links, the defendants and other co-conspirators typically stole the funds for their personal use.  Bank records show that the defendants converted the investors’ money into cash through over 900 ATM and teller withdrawals.  They also wrote checks to themselves and made personal purchases.  To date, investigators have identified at least $9.3 million in investor losses from the scheme.

The criminal case has been assigned to United States District Judge Eric N. Vitaliano.  If convicted, each defendant faces up to 20 years’ imprisonment, as well as a fine equal to double the investors’ losses, and mandatory restitution to the victims.

The government’s case is being prosecuted by the Office’s Business and Securities Fraud Section.  Assistant United States Attorneys Jack Dennehy and Alexander Mindlin are responsible for the prosecution.

The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force.  The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud.  Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations.  Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants.  For more information on the task force, please visit www.StopFraud.gov.

The Defendants:

JOHN DESANTIS
Age: 40
Staten Island, New York

DWAYNE MALLOY
Age: 41
Hazlet, New Jersey

E.D.N.Y. Docket No. 15 CR 135 (S-1) (ENV)


[1] The charges announced today are allegations, and the defendants are presumed innocent unless and until proven guilty.

Topic(s): 
Financial Fraud
Securities, Commodities, & Investment Fraud
StopFraud
Updated December 20, 2016