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Press Release

New York Investment Adviser Convicted Of Defrauding Investors

For Immediate Release
U.S. Attorney's Office, Middle District of Pennsylvania

HARRISBURG – Louis F. Petrossi, age 77, the founder and president of the Wealth Research Institute, a purported investment research firm, was convicted yesterday by a federal jury in the Middle District of Pennsylvania, on three counts of securities fraud, investment adviser fraud, and wire fraud for his role in a scheme to defraud investors.  The four-day trial was held before Chief United States District Court Judge Christopher C. Conner in Harrisburg. 

David J. Freed, United States Attorney for the Middle District of Pennsylvania and Richard P. Donoghue, United States Attorney for the Eastern District of New York, jointly announced the verdict.

The evidence at trial established that Petrossi falsely claimed to investors that money they had invested in purported investment funds, Chadwicke Partners LLC (“Chadwicke Partners”) and Chadwicke Ventures LLC (“Chadwicke Ventures”), would be used to invest in startup companies.  Instead, the defendant used the investors’ money to pay for personal expenses and issued fraudulent statements that overstated both the cost and value of the securities held by Chadwicke. 

The evidence also showed that between January 2015 and January 2017, Petrossi solicited more than $1.8 million in investments in Chadwicke Partners from more than 25 investors nationwide including an investor residing in the Middle District of Pennsylvania.  Petrossi promoted Chadwicke as providing the opportunity to invest in high-profile startups companies such as Lyft, Inc., Maplebear Inc., Pinterest Inc., Spotify Technology SA, and Palantir Technologies, Inc. among others.  Petrossi invested approximately $665,400 in privately held startup companies but used more than $1.1 million in investor funds to pay for personal expenses, including payments to BMW, renovations to his home and to pay his personal legal fees. In or around August 2016, Petrossi sent emails to Chadwicke investors attaching a spreadsheet that contained false and misleading statements about the purchase price and value of the securities held by the Chadwicke funds in order to conceal his misappropriation of investor money.

On May 3, 2016, Petrossi was arrested in Nevada pursuant to an indictment returned by a federal grand jury in the Eastern District of New York for his role in a securities fraud scheme involving the securities of ForceField Energy Inc.  Under the terms of Petrossi’s pre-trial release, the defendant was prohibited from employment “directly involving the handling of investors.”  Between May 3, 2016 and approximately January 2017, Petrossi continued to engage in the Chadwicke scheme by emailing the August 2016 spreadsheet and soliciting $210,000 in investor funds.

Petrossi faces a maximum of 20 years’ imprisonment on each count of conviction when he is sentenced by Chief Judge Conner of the Middle District of Pennsylvania.

Petrossi was convicted in May 2017 by a federal jury in Brooklyn for his role in the ForceField Energy Inc. market manipulation scheme.  He faces a maximum sentence of 20 years’ imprisonment when he is sentenced by United States District Judge Brian M. Cogan of the Eastern District of New York.

Assistant United States Attorney Mark E. Bini of the Eastern District of New York and Special Assistant United States Attorney John O. Enright of the United States Securities and Exchange Commission’s Enforcement Division prosecuted the case.

The matter was investigated by the United States Securities and Exchange Commission’s Enforcement Division.

A sentence following a finding of guilt is imposed by the Judge after consideration of the applicable federal sentencing statutes and the Federal Sentencing Guidelines.

Under the Federal Sentencing Guidelines, the Judge is also required to consider and weigh a number of factors, including the nature, circumstances and seriousness of the offense; the history and characteristics of the defendant; and the need to punish the defendant, protect the public and provide for the defendant's educational, vocational and medical needs. For these reasons, the statutory maximum penalty for the offense is not an accurate indicator of the potential sentence for a specific defendant.


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Updated March 9, 2018

Financial Fraud