Jewelry Wholesaler Pleads Guilty in $200 Million Ponzi Scheme
Defendant Falsely Promised High Rates of Return for Investments in Wholesale Jewelry Purchases
Earlier today, at the federal courthouse in Brooklyn, Gregory Altieri pleaded guilty to wire fraud for running a two-year $200 million Ponzi scheme based on false statements to investors about inflated returns for nonexistent wholesale jewelry deals. As part of the plea, Altieri also admitted to committing securities fraud in connection with the scheme. When sentenced, Altieri faces up to 20 years in prison. Today’s proceeding took place before United States District Judge Brian M. Cogan.
Seth D. DuCharme, Acting United States Attorney for the Eastern District of New York, announced the guilty plea.
“With today’s guilty plea, Altieri is held accountable for duping dozens of investors, including retirees living off their pensions,” stated Acting United States Attorney DuCharme. “The defendant’s lies have caught up to him and he will now face the consequences of his fraudulent scheme.” Mr. DuCharme expressed his grateful appreciation to the Federal Bureau of Investigation, New York Field Office, for its exemplary work on the case, and to the Securities and Exchange Commission, New York Regional Office, for their assistance.
Beginning in August 2017, Altieri solicited between $75 million to $85 million in investments in his entity, LNA Associates, from over 80 investors located in Queens, Staten Island, Long Island and elsewhere. Altieri told investors that their money would be used to purchase jewelry at “closeout” prices, which would then be resold at a high profit yielding returns on those investments of between 30 and 70 percent in a matter of months. While Altieri initially purchased some jewelry with investors’ money, since approximately May 2018, he used money from new investors to pay earlier investors, representing to the latter group that they were receiving returns on their investments. These purported “returns” were used by Altieri to convince the earlier investors to keep their money with LNA Associates by “rolling over” their funds into new investments based on false promises to use this money to purchase additional jewelry. By January 2020, when Altieri stopped making payments to investors, he owed them approximately $200 million based on the falsely inflated promised returns.
The government’s case is being handled by the Office’s Business & Securities Fraud Section. Assistant United States Attorneys Andrey Spektor and Lindsay K. Gerdes are in charge of the prosecution, assisted by Assistant United States Attorney Brian D. Morris of the Office’s Asset Forfeiture Unit and by a Special Agent of the Office’s Business & Securities Fraud Section.
Melville, New York
E.D.N.Y. Docket No. 20-CR-249 (BMC)