Importing Company’s Founder Pleads Guilty to Securities Fraud
On September 12, 2014, Eric Aronson, the founder and head of Permapave Industries LLC and Permapave USA Corporation (“Permapave”), pleaded guilty to securities fraud for soliciting over $30 million from more than 200 investors for fraudulent Permapave promissory notes. Permapave marketed porous paving stones in the United States that were manufactured in Australia.
The guilty plea was announced by Loretta E. Lynch, United States attorney for the Eastern District of New York, and George Venizelos, Assistant Director-in-Charge, Federal Bureau of Investigation, New York Field Office (FBI).
According to court filings and facts presented at the plea hearing, the defendant and his coconspirators issued promissory notes to investors and promised to use the proceeds to finance shipments of Permapave paving stones from Australia to the United States. In reality, the defendant, together with his coconspirators, operated a Ponzi scheme whereby some investors were paid returns on their investment from the funds the defendant obtained from other defrauded investors. From approximately August 2006 to December 2010, the defendant defrauded investors out of approximately $30 million through this scheme. The defendant and his coconspirators converted millions of dollars of investor funds for personal expenditures, including vacations, watches, jewelry, and automobiles.
“The defendant used the promise of sound securities investments to steal investor funds. He pretended to be a legitimate businessmen but he was no more than a common thief. Through his actions, the defendant caused the financial ruin of many, all the while enriching himself. This office will vigorously investigate and prosecute those who lie to, cheat, and steal from the investing public,” stated Unites States Attorney Lynch. Ms. Lynch extended her grateful appreciation to the Federal Bureau of Investigation, the agency responsible for leading the government’s investigation.
Today’s guilty plea took place before Magistrate Judge Gary Brown at the federal courthouse in Central Islip, N.Y. Aronson faces a maximum sentence of 20 years’ incarceration.
The case is being prosecuted by Assistant United States Attorney William P. Campos.
This case was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The Task Force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The Task Force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.
- ERIC ARONSON
- Age: 46
- Syosset, New York
- E.D.N.Y. Docket No. 12-CR-245