Individual Who Portrayed Himself as Experienced Stock Trader Pleads Guilty to Defrauding Investor
Defendant Solicited Investments, Then Stole the Money for Himself
Earlier today, at the federal courthouse in Brooklyn, Gonzalo Ortiz pleaded guilty to investment adviser fraud in connection with a scheme to defraud an investor of nearly $600,000 by making false representations about his trading expertise and the profitability of various investments. The proceeding was held before United States District Judge William F. Kuntz, II.
Breon Peace, United States Attorney for the Eastern District of New York, and Michael J. Driscoll, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI), announced the guilty plea.
“Ortiz masqueraded as an experienced stock trader who could substantially increase the victim’s savings, but instead he stole close to a quarter million dollars of the victim’s money to use for his own personal benefit,” stated United States Attorney Peace. “This Office will continue to prosecute and hold accountable those who engage in fraud and steal the hard-earned money of investors.” Mr. Peace expressed his appreciation to the United States Securities and Exchange Commission, New York Regional Office, for its assistance in this case.
“Ortiz misrepresented to his victim his ability to invest funds in a profitable way, not only causing a significant loss in value, but also reserving a good deal of the money for his own personal benefit,” stated FBI Assistant Director-in-Charge Driscoll. “Investment fraud schemes are all too common, often causing emotional trauma to those affected. Our office is committed to investigating this type of criminal activity and holding the perpetrators accountable.”
Between approximately April 2015 and May 2017, Ortiz falsely represented himself to an investor (the “Victim”) as a successful investment adviser who had made profits for other individuals by trading stocks on their behalf. Ortiz convinced the Victim to allow him to invest the Victim’s money, promising significant returns. Based on those misrepresentations, the Victim made successive investments with Ortiz over a period of years. During this time, Ortiz falsely told the Victim that the investments were profitable and sent the Victim a false account statement to support these claims. In reality, Ortiz made poor trading decisions that resulted in the loss of a portion of the Victim’s money, and also stole some of the Victim’s money for himself, siphoning off portions of the investments to pay for personal expenses including clothing, food and car payments. Ortiz controlled nearly $600,000 of the Victim’s money, stole approximately $224,500 for himself and lost a significant amount of the Victim’s money to unprofitable trades.
The case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorney Andrew D. Grubin is in charge of the prosecution.
Hackensack, New Jersey
E.D.N.Y. Docket No. 19-CR-161 (WFK)