Brooklyn Man Pleads Guilty in Manhattan Federal Court to Securities Fraud in Connection with Multi-Million-Dollar Fraudulent Investment Scheme
Preet Bharara, the United States Attorney for the Southern District of New York, announced today that MARCELLO TREBITSCH pled guilty in Manhattan federal court to an Information charging him with one count of securities fraud in connection with his operation of a Ponzi scheme that defrauded investors of nearly $6 million over the course of seven years. Among other things, TREBITSCH admitted that he lied to investors by telling them that he would invest their money through an investment fund he controlled that would generate double-digit returns with very low risk. To that end, TREBITSCH provided investors with phony account statements and federal tax forms that reflected significant gains, when, in reality, TREBITSCH invested only a portion of the investors’ money and suffered enormous trading losses, and used the remainder of the investors’ money for his own personal benefit and to pay back other investors. TREBITSCH was arrested on April 13, 2015, and pled guilty today before United States District Judge Vernon S. Broderick.
U.S. Attorney Preet Bharara said: “As Marcello Trebitsch admitted in court today, he ran a multimillion-dollar Ponzi scheme, defrauding investors who put their faith in him and entrusted him with their hard-earned savings. He returned their faith with deceit and self-dealing, lying about his trading losses and using investor money on himself. I want to thank the FBI for their outstanding investigative work on this case.”
According to the Complaint, the Information that was filed today in Manhattan federal court, and other statements made in open court:
From 2007 through 2014, TREBITSCH engaged in a multimillion-dollar fraudulent investment scheme, during which he solicited money from investors based on materially false and misleading representations. Specifically, TREBITSCH told the investors that he, through an investment fund he created called Allese Capital LLC, would (a) create and perfect public shell companies to sell to private companies; (b) execute specific trades at the direction of an investor; and (c) purchase and sell stocks on a daily basis, with little or no funds remaining invested in the market at the end of each trading day. In some cases, TREBITSCH told the investors that they would receive double digit returns with minimal risk of loss. In fact, TREBITSCH did not invest the money as he said he would, and instead principally used the investors’ money for his own personal benefit, including to repay other investors.
With respect to the portion of investor funds that he did use to purchase securities, TREBITSCH suffered net trading losses, which he did not disclose to the investors. Rather, TREBITSCH sent the investors false and misleading monthly account statements and tax forms, which purported to show positive annual returns.
During the course of the fraudulent scheme, TREBITSCH solicited more than $8 million from four investors.
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TREBITSCH, 37, of Brooklyn, New York, pled guilty to one count of securities fraud, which carries a maximum sentence of 20 years in prison, a maximum fine of $5 million, or twice the gross gain or loss from the offense. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge. As part of the plea agreement, TREBITSCH agreed to pay forfeiture and restitution to the victims of the offense in the amount of $5,905,949. TREBITSCH is scheduled to be sentenced by Judge Broderick on November 2, 2015, at 10:00 a.m.
Mr. Bharara praised the work of the Federal Bureau of Investigation.
The charges were brought in connection with the President’s Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys’ offices, and state and local partners, it is the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets; and conducting outreach to the public, victims, financial institutions and other organizations. Since fiscal year 2009, the Justice Department has filed over 18,000 financial fraud cases against more than 25,000 defendants. For more information on the task force, please visit www.StopFraud.gov.
This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Daniel S. Goldman and Amy Lester are in charge of the prosecution.