Chief Operation Officer, Comptroller, and Director of Sales Sentenced in $21 Million Fraud Scheme
|U.S. Attorney’s Office February 03, 2014|
Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, and Michael B. Steinbach, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, announce the sentencing of Timothy B. Josselson, 49, and Kathryn A. Josselson, 42, both from Parma, Ohio, and Robert S. Lananna, 29, of Boynton Beach, Florida, for their participation in a $21 million investment fraud scheme.
The defendants were each sentenced to 60 months in prison, followed by three years of supervised release. On January 23, 2014, U.S. District Judge Michael Moore sentenced Kathryn Josselson and scheduled a restitution hearing for March 24, 2014. On January 30, 2014, U.S. District Judge Cecilia Altonaga sentenced Timothy Josselson and scheduled a restitution hearing for March 31, 2014. On Friday, U.S. District Judge Ursula Ungaro sentenced Robert Lananna and scheduled a restitution hearing for March 14, 2014.
These three defendants pled guilty in November 2013 to separate Informations, each charging one count of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 371. According to court documents, Timothy Josselson, Kathryn Josselson, and Lananna conspired with each other and with other co-conspirators who were charged in a separate indictment. The indicted co-conspirators include James C. Howard, III; Patricia S. Saa; Louis N. Gallo, III; and Michael R. Casey.
According to court documents, the defendants conspired to defraud individuals who invested in Commodities Online LLC (COL). Timothy Josselson was the chief operating officer, Katrhyn Josselson was the comptroller, and Lananna was the director of Sales. From approximately January 2010 through April 2011, the defendants used material false and fraudulent representations and material omissions to obtain more than $21 million from more than 700 investors. According to court documents, the investors lost over $18 million.
According to court documents, the defendants used COL to sell investments in purported transactions to buy and sell commodities. Among other things, the defendants represented to investors that COL had a track record of profits. However, COL did not have profits. Any payments made to investors were made using funds received from newer investors.
Also according to court documents, the defendants also made material misrepresentations and omissions about the leaders of COL. After mid-2010, the defendants represented that Howard, who was the founder of COL, was no longer president of COL. Defendant Casey, an attorney, was given the title of president of COL. However, Howard remained in charge.
Howard pled guilty and was sentenced on December 3, 2013, to 189 months in prison. A restitution hearing is set for February 24, 2014. The trial of Howard’s co-defendants is scheduled for March 10, 2014.
Mr. Ferrer commended the investigative efforts of the FBI. These cases are being prosecuted by Assistant U.S. Attorney Ana Maria Martinez.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls.