Cambria County Investment Advisor Pleads Guilty in $4.5M Fraud Scheme
JOHNSTOWN, Pa. – A resident of Lilly, Pa., pleaded guilty in federal court to charges of securities fraud, wire fraud, and filing false income tax returns, United States Attorney Scott W. Brady announced today.
Douglas P. Simanski, 53, pleaded guilty to five counts before United States District Judge Kim R. Gibson.
In connection with the guilty plea, the United States presented information to the Court that established that between February 2002 and May 2016, Simanski, an investment advisor and broker, devised and executed a scheme to fraudulently obtain approximately $4.5 million from various investors. As part of his scheme, Simanski fabricated "Tax Free Investment" contracts and "fake CDs" which listed guaranteed rates of return and payouts, and used the documents to solicit investors. Simanski used portions of the invested funds to pay "returns" to other investors to make it appear their investments were legitimate. He also used a portion of the funds to purchase personal items and to fund personal home improvement projects, and placed some of the funds into a personal E*Trade account. The United States also presented information to the Court that Simanski filed false income tax returns for 2012, 2013, and 2014.
Judge Gibson scheduled sentencing for April 4, 2019, at 10:00 a.m. The law provides for a maximum total sentence of 49 years in prison, a fine of $6,000,000 or both. Under the Federal Sentencing Guidelines, the actual sentence imposed would be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant United States Attorney Stephanie L. Haines is prosecuting this case on behalf of the government.
The Internal Revenue Service Criminal Investigation and the United States Secret Service conducted the investigation that led to the prosecution of Simanski.