‘Pre-IPO’ Boiler Room Operators Sentenced To Prison

United States Attorney for the Southern District of New York, Jamie McDonald, announced today that the founders and operators of Legend Venture Partners LLC (“Legend”) and its affiliated entities were sentenced to significant prison time for defrauding their investors, violating their fiduciary duties to those investors, and stealing their funds. MARIO GOGLIORMELLA was sentenced to 52 months in prison, and STEVEN LACAJ and KARIM IBRAHIM, a/k/a “Chris Hayes,” were each sentenced to 42 months in prison. GOGLIORMELLA, LACAJ, and IBRAHIM pled guilty before U.S. District Judge Vernon S. Broderick, who imposed sentence on GOGLIORMELLA on September 16, 2026; LACAJ on September 23, 2026; and IBRAHIM today. 

“This Office will continue to prioritize enforcement against fraud in the pre-IPO space,” said U.S. Attorney Jamie McDonald. “Our markets—both public and private—can flourish only if their integrity is preserved. By charging undisclosed markups of over a hundred percent and pretending their own disciplinary histories didn’t exist, the defendants—the founders and operators of Legend Venture Partners LLC—stole from hundreds of investors and undermined the functioning of markets that are vital to innovation and growth.”

According to the allegations contained in the Indictment, public filings, and statements made in court:

GOGLIORMELLA, LACAJ, and IBRAHIM engaged in a scheme to defraud investors in a group of related private funds known generally as the “StraightPath Funds” and the “Legend Funds.” The defendants, and others working at their direction, used “boiler room”-style call centers to market the funds to non-professional investors by promising an opportunity to invest in privately held companies expected to go public in the near future (“pre-IPO companies”). The defendants purported to offer investors the chance to acquire shares in pre-IPO companies at favorable prices in advance of an anticipated public offering, at which time, they claimed, the shares would be worth significantly more. The defendants also claimed there were no upfront fees or commissions, and that they would not get paid until their investors got paid.

These representations that the defendants made to investors were lies. In fact, the defendants sold shares to investors at arbitrarily inflated and excessive prices without disclosing to investors the nature or extent of the markup. The defendants’ fraudulent misrepresentations about the operation of their funds allowed them to raise approximately $185 million from hundreds of investors. Based in large part on the excessive and undisclosed share price markups they charged to investors, the defendants were able to divert nearly $28 million in investor funds to themselves. They also used investor funds to pay their sales representatives at least $17.5 million in fees and commissions, despite making explicit representations to investors that fees were not being charged. In addition to misrepresentations about fees and markups, the defendants also misled investors regarding the nature of their investments and hid the involvement of GOGLIORMELLA and IBRAHIM, who had been previously been disciplined by the Financial Industry Regulatory Authority, in the management of the Funds.

In order to generate interest in the Funds among retail investors, GOGLIORMELLA, LACAJ, and IBRAHIM used finders, or “referral agents,” to pitch prospective investors and thereafter to serve as the investors’ primary point of contact. The defendants used “boiler room”-style call centers wherein salespeople cold-called potential investors, many of whom were not experienced investors, and gave aggressive sales pitches using notes and pitch scripts. The defendants referred to their pitch scripts as “The Bible.” Contrary to the defendants’ claim that they and their agents did not make money unless and until investors received a profit on their investments, the defendants paid referral agents a commission, typically a 10 to 15 percent front-end fee based on the amount of the investment that agents were able to draw to the Funds, plus a portion of the carried interest when the Funds exited their position in a particular company.

At first, the defendants operated this scheme as a marketing arm for StraightPath Venture Partners, Inc. (“StraightPath”). In approximately 2021, multiple individuals associated with StraightPath received subpoenas from the SEC, and in approximately February 2022, StraightPath ceased operations. In approximately February 2022, when StraightPath ceased operations, GOGLIORMELLA, LACAJ, and IBRAHIM began conducting the scheme under the corporate entity Legend Venture Partners, LLC (“Legend”), where they continued to run the same scheme that StraightPath had started. The three principals of StraightPath —Michael Castillero, Brian Martinsen, and Francine Lanaia—were also prosecuted by this Office, convicted at a trial before U.S. District Court Judge Jesse M. Furman in November 2025, and sentenced to 11, 10, and 8 years respectively by Judge Furman in May 2026.

The StraightPath entities and StraightPath Funds and Legend entities and Legend Funds are no longer operational and are under the control of a court-appointed Receiver tasked with taking possession of StraightPath and Legend’s assets and overseeing a plan to return value to investors.

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In addition to the prison term, GOGLIORMELLA, 49, of Manhasset, New York; LACAJ, 29, of New York, New York; and IBRAHIM, 36, of Queens, New York, were each sentenced to three years of supervised release. They were also ordered to pay restitution of $46 million, as well as forfeiture in the following amounts: Gogliormella: $12,400,000; Lacaj: $7,700,000; and Ibrahim: $8,300,000.

Mr. McDonald praised the outstanding work of the U.S. Postal Inspection Service. Mr. McDonald also thanked the U.S. Securities and Exchange Commission, which has filed a parallel civil action.

The case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Adam S. Hobson and Matthew R. Shahabian are in charge of the prosecution.