Parkland Man Gets 7 Years in Prison For Bilking Elderly Investors

Isaac Grossman

By Kevin Deutsch

A Parkland man who conned elderly investors out of millions of dollars was sentenced Thursday to 87 months in federal prison, according to the Department of Justice.

Isaac Grossman, 47, of Heron Bay, directed an elder fraud scheme in which he sold stock in his South Florida-based technology company to senior citizens across the U.S., then misappropriated their money for his own personal use, federal prosecutors said.

U.S. District Judge Raag Singhal sentenced Grossman in Fort Lauderdale federal court after Grossman had previously pleaded guilty to wire fraud, mail fraud, and money laundering charges. Grossman had faced up to 50 years in prison for his crimes.

He was also ordered to pay nearly $3 million in restitution, court records show.

Grossman will be credited with about seven months served and must surrender to the federal Bureau of Prisons no later than April 8, according to the records.

From September 2014 through April 2018, Grossman raised around $2.4 million in investor funds for his company, Dragon-Click Corp., by soliciting investments from elderly retirees across the country, prosecutors said.

Grossman’s pitch to investors: Dragon-Click was developing a revolutionary internet application, and they had a chance to get in on the ground floor. He told them the new shopping app would allow users to post a photo of any item they might want to purchase, immediately recognize all retailers who sell the item, and provide price comparisons and links to buy.

Grossman admitted he falsely told investors they would double, triple, or quadruple their money. According to DOJ, he even claimed Dragon-Click was on the verge of being sold to a large technology company like Google, Apple, or Amazon for over $1 billion.

Before raising funds for Dragon-Click, he concealed from investors that the Financial Industry Regulatory Authority had permanently barred him from acting as a broker or associating with brokerage firms.

He also hid the fact he had been permanently banned from commodities trading by the U.S. Commodity Futures Trading Commission.

With investors’ money in hand, Grossman spent $1.3 million of his fraudulent gains on gambling, diamond jewelry, luxury cars, home mortgage payments, tuition payments for his children’s private school education, and other personal expenditures, including a McLaren MP4-12C, a Chevrolet Corvette and a 4.81-carat diamond ring, prosecutors said.

In addition to his criminal case, the government also filed a parallel civil enforcement action against Grossman.

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Parkland Man Gets 7 Years in Prison For Bilking Elderly Investors 

 

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Parkland Man Arrested for Bilking Elderly in Money Laundering Scheme

‘Real Housewives’ Star Cannot Dismiss Federal Indictment Accusing Her of Defrauding Elderly in Nationwide Telemarketing Scheme

by Adam Klasfeld

“Real Housewives of Salt Lake City” star Jennifer Shah cannot dismiss an indictment accusing her of conspiring to defraud elderly and vulnerable people out of millions in a nationwide telemarketing scheme, a federal judge ruled.

On March 30, authorities arrested Shah (and her “first assistant” and accused co-conspirator Stuart Smith) in Utah. Smith is not one of the subjects of the federal judge’s latest ruling, but his case remains pending. Both were charged with conspiring to commit fraud and money laundering.

Manhattan U.S. Attorney Audrey Strauss announced their imminent transfers to the Southern District of New York in a statement accusing the duo of using their celebrity status to bilk hundreds of victims.

“Jennifer Shah, who portrays herself as a wealthy and successful businessperson on ‘reality’ television, and Stuart Smith, who is portrayed as Shah’s ‘first assistant,’ allegedly generated and sold ‘lead lists’ of innocent individuals for other members of their scheme to repeatedly scam,” Strauss said on the day of their arrest. “In actual reality and as alleged, the so-called business opportunities pushed on the victims by Shah, Smith, and their co-conspirators were just fraudulent schemes, motivated by greed, to steal victims’ money.”

On Thursday, Senior U.S. District Judge Sidney Stein rejected Shah’s bid to dismiss the indictment. The judge also jettisoned a flurry of other pre-trial motions filed by Shah and another accused co-conspirator, Cameron Brewster.

“The superseding indictment here sufficiently alleges that Shah joined the telemarketing conspiracy willfully and with specific intent to defraud,” Judge Stein wrote in a 10-page opinion and order.

Prosecutors claim that Shah “generated and sold leads to other [participants in the telemarketing scheme] for use by their telemarketing sales floors with the knowledge that the individuals they had identified as ‘leads’ would be defrauded by the other participants.”

Brewster referred to those lead lists as a “money sucking website,” prosecutors say.

The judge also dispensed with Shah’s argument that prosecutors did not allege fraudulent and “material” promises to victims.

“The Court also rejects Shah’s argument that the indictment is deficient for failure to specifically allege that the misrepresentations made to the victims of the business opportunity scheme were material,” Judge Stein wrote.

Shah also sought to suppress her post-arrest statements, claiming they were involuntary.

The former reality TV star concedes that she signed a Miranda waiver, but she claimed that law enforcement misled her by telling her they “just wanted to talk” to her. She asserted that she lacked sophistication with the criminal justice system and was “confused and emotionally off-balanced” at the time of her interrogation. She also claimed that she was “unable to read” the waver because she did not have her reading glasses and her contact lenses were blurry.

None of these arguments resonated with Judge Stein.

“Considering the totality of the above circumstances taken from the affidavits in the record, as well as the fact that the Court has listened to a recording of the interrogation, the Court finds that Shah’s Miranda waiver was decidedly voluntary,” he ruled.

Attorneys for Shah and Brewster did not immediately respond to emails requesting comment.

Read the ruling below:

 

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‘Real Housewives’ Star Cannot Dismiss Federal Indictment Accusing Her of Defrauding Elderly in Nationwide Telemarketing Scheme

Parkland Man Arrested for Bilking Elderly in Money Laundering Scheme

Isaac Grossman

By: Saraana Jamraj

A Parkland man has been arrested and accused of orchestrating a sizeable money-laundering scheme that involved defrauding elderly victims with promises of quadrupling their money.

In a joint effort between the Federal Bureau of Investigations, the Security and Exchange Committee, and the U.S. Attorney’s office, Heron Bay resident, Isaac Grossman, 45, was investigated and indicted on the charges of wire fraud, mail fraud, and money laundering.

Grossman ran a company called Dragon-Click Corp, a South Florida-based technology company, which he allegedly used to target the elderly to pull off an array of financial crimes.

According to the indictment by U.S. Attorney Ariana Fajardo Orshan and George L. Piro, Special Agent in Charge of the FBI’s Miami Field Office,  Grossman spent at least $1.3 million of investors’ money on gambling, diamond jewelry, luxury cars, tuition payments for his children’s private education, and other personal expenditures.

Some of the larger purchases made include $35,000 of investors’ funds on a 4.81-carat diamond ring, $21,200 for a lease payment on a McLaren MP4-12C, $36,500 to purchase a Chevrolet Corvette, and $34,500 to partially pay off his home mortgage.

In the alleged scheme, Grossman sought elderly retired investors across the country to invest in his business. To attract potential investors, he told them about a revolutionary new shopping app that would allow users to post a photo of any item they might want to purchase, and immediately recognize all retailers who also sell the item, as well as provide price comparisons and links to purchase.

The product he described bares some similarity to Google Lens, an existing app that can contextualize photos users submit, providing them with identification information about it.

To further solicit them, Grossman allegedly told investors that his company would be sold to larger corporations, such as Google, Apple, or Amazon, for more than one billion dollars and that their money could even be quadrupled. 

From September 2014 to April 2018, with at least 26 investors, Grossman was able to raise approximately $2.4 million.

Isaac and his wife, Adriana Grossman.

Instead of using the money for an internet application, patent, legal fees to close that supposed billion dollar sale, or any other legitimate business purposes, Grossman allegedly used that money to provide and maintain a lavish, luxurious lifestyle for him and his wife, Adriana.

This was not Grossman’s first brush with the law.  After entering the financial securities sector in 1997, he faced regulatory reprimand and consequences in 2012.

In addition to misusing investors’ money, Grossman also fraudulently concealed this fact from investors that he was permanently banned from acting as a broker by the Financial Industry Regulatory Authority and banned from trading the U.S. Commodity Futures Trading Commission. He also owed them over $121,000 fines.

Grossman and his wife were also hit with a civil lawsuit by the SEC in June of 2018, where their financial crimes were further detailed, including an alleged $426,000 of investors’ funds used solely on gambling. Adriana was alleged to have spent at least $293,000 of investors’ money between 2014 and 2016.  Their LLC, Dragon Management, was organized by her, and she was listed as the sole signor, likely so they could do business under her name.

Isaac Grossman was arrested on October 11 and faces a minimum of 20 years for each fraud charge, and 10 years for each money laundering charge.

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Parkland Man Arrested for Bilking Elderly in Money Laundering Scheme

Milford Man Arrested, Charged With Defrauding Elderly Person

US District Court in New Haven

An area man is facing decades behind bars for allegedly defrauding his elderly person of $60,000 through a fraud and money laundering scheme.

Milford resident Christopher Sakelarakis has been indicted by a federal grand jury in New Haven charging him in the investment scheme that allowed him to bilk his victim out of thousands of dollars to live a lavish lifestyle.

The indictment alleges that Sakelarakis “held himself out as having the necessary qualifications, experience and abilities to provide investment services to a victim-investor.” Sakelarakis allegedly claimed that he had multiple investment clients and was making a substantial profit through day trading. He also stated that he had a contact in an investment firm who provided him with stock tips. As part of his scheme, Sakelarakis allegedly said he would invest in stocks, options and other financial instruments on behalf of his victim and in exchange, he would keep 10 percent of the profits.

Sakelarakis allegedly was provided a $60,000 check by his victim in October last year. The indictment further alleges that within days, Sakelarakis withdrew $30,000 in cash, then made additional cash withdrawals at ATMs. Sakelarakis allegedly spent the money at stores that include Armani Exchange, Gamestop, Macy’s and Foot Locker.

John Durham, the United States Attorney for the District of Connecticut, said that Sakelarakis also allegedly made several false statements in emails to his victim regarding the status of the “investments.” None of the money was ever returned to Sakelarakis’ victim.

Sakelarakis, 34, was arrested on Monday morning and charged with five counts of wire fraud, three counts of securities fraud and one count of money laundering. He pleaded not guilty to the charges and was released on $60,000 bond. Sakelarakis is scheduled to appear in court at a later date to answer the charges.

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Milford Man Arrested, Charged With Defrauding Elderly Person

Ex-lawyer in Charleroi admits defrauding elderly woman, used money to run Mon Valley newspaper

Keith Allen Bassi, a former lawyer, admitted Monday morning that he stole half a million dollars from an elderly lady with dementia and used some of it to run the newspaper, the Mon Valley Independent.

Mr. Bassi, 61, of Charleroi, pleaded guilty in federal court to mail fraud counts in ripping off a woman identified as "N.J.L," who is 85 and living in a Mt. Lebanon care home.

Prosecutors said he pilfered about $505,000 from her accounts and put the money in his own accounts, including that of the paper he co-owns.

"It's certainly despicable," said the woman's 75-year-old cousin, who is seeking to become her legal guardian and watched the proceedings before U.S. District Judge Arthur Schwab.

He asked that he and she not be named publicly until guardianship is granted.

Mr. Bassi was charged Sept. 25 after an investigation by the FBI and U.S. postal inspectors.

Assistant U.S. Attorney Greg Melucci said he gained power of attorney over her estate, which could be worth some $3 million, in 2006. The woman, a former Pittsburgh public schools principal, was diagnosed with dementia in 2012.

It was then that Mr. Bassi began maneuvering to transfer money out of her accounts and into his.

Mr. Melucci said he misappropriated the funds between 2013 and 2016.

As part of the scheme, he used her money to a $55,000 annual premium on a life insurance policy between 2013 and 2015, then asked for a "surrender request" for the policy in 2016 and deposited the amount, about $163,000, into his personal account.

Mr. Bassi also deposited $110,000 of N.J.L.'s money into the publishing company account at CFS Bank.

Mr. Melucci said federal agents, who learned of the fraud by monitoring suspicious banking transactions, confronted Mr. Bassi in May. He admitted to the crime and said he did it because of "financial issues."

Mr. Bassi's law license has been suspended. He remains free on bond pending sentencing March 14.

He said nothing in court except to answer Judge Schwab's questions about his guilt. The exact amount of money he stole is in some dispute and will be worked out before the sentencing.

"Mr. Bassi has agreed to pay full restitution," said his lawyer, Stephen Stallings.

He declined further comment as he left the courthouse with his client.

The victim's cousin, a former teacher and attorney, contacted the U.S. attorney's office and Judge Schwab after reading about the fraud in the Pittsburgh Post-Gazette last week.

In a letter to them, he said he suspects Mr. Bassi may have stolen more than the $505,000 for which he was charged. He said he and other family members had received a letter from Mr. Bassi after N.J.L. had moved to the nursing home in 2015 indicating that he was auctioning off the personal property that she had kept at the family farm in Washington County.

The cousin said no one has seen those proceeds.

Among her collections, he said, was China worth some $100,000, figurines valued at $2,000 each and family memorabilia. The house, which was sold in 2012, dates to the 1780s.

"I'd just like to know what the hell happened to the other stuff," her cousin said.

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Ex-lawyer in Charleroi admits defrauding elderly woman, used money to run Mon Valley newspaper

House Bill Aims to Protect the Elderly Against Ongoing Fraud Attempts

Stan & Nancy Salisbury

For weeks now, a 60-year-old woman has felt the pressure of an increasingly aggressive “IRS officer” calling to demand owed money.

These supposed back taxes are not the first time Valerie Sicher has been targeted by con artists looking for her financial information.

“I’ve never been scammed because I’ve been aware of it,” said Sicher, a retired member of a Miami credit union board of directors.

The calls have been reported to the IRS, but representatives told Sicher that the calls are untraceable from her work phone.

On Oct. 1, Florida house bill 409 passed, which allowed prosecutors more leeway in convicting criminals who exploit the elderly, but only one in seven exploitation cases are making it to prosecution, said Shannon Miller, ESQ., of the Miller Elder Law Firm.

Out of 45 thousand cases, exploitation victims make up for 15.86 percent of the total investigations, according to the 2013-2014 data collected by the Florida Department of Elder Affairs.

“These are often deep family matters; they can involve all kinds of risks and liabilities,” said Nancy Salisbury, a retired public health official and minister. “Victims fear embarrassment and emotional distress along with the risks of personal safety.”

An extra $5 million to add to a retirement plan may have sounded irresistible to some, but “risk-free” money never seems to work out that way.

Stan and Nancy Salisbury, elderly retirees of Gainesville, received a first-class letter last August that offered the split of a hefty inheritance of their unknown relative James Salisbury.

“All the numbers, companies and addresses check out,” Stan said. “But there’s definitely no Jameses on my side of the family.”

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House Bill Aims to Protect the Elderly Against Ongoing Fraud Attempts

Ex-banker gets 5 years for defrauding elderly

Diane Elizabeth Niehaus

DAYTON —A former Centerville Union Savings Bank manager was sentenced Thursday to five years in prison after pleading guilty to stealing more than $1 million from elderly and vulnerable customers.

Diane Elizabeth Niehaus, 40, was convicted of embezzlement, money laundering and filing a false tax return in Dayton’s U.S. District Court after a yearslong scheme of what prosecutors said was taking advantage of customers who were dying, sick and suffering from cognitive conditions such as Alzheimer’s Disease.

Before he announced the sentence, U.S. District Court Judge Timothy S. Black told Niehaus she was as “skillful and sophisticated a manipulator as this judge has seen in 20 years” and that her bank job put her in “perfect position to rape and pillage (the victims’) savings.”

The amount of restitution Niehaus must pay — which Black said was between $400,000 and $700,000 — will be determined at a future hearing. Most of the money that victims got back came from Union Savings Bank and insurance companies, not from Niehaus.

Black allowed Niehaus to leave the court on a promise to return in 30 to 45 days when she will report to serve her sentence in a federal penitentiary.

At Black’s urging, Niehaus turned and apologized to Joan Lyons, the eldest daughter of Dorothy Cline and the late Jesse Cline. Court records show Niehaus and her husband, Paul, often visited the Clines under the guise of helping them.

Niehaus ultimately convinced Dorothy Cline, who was suffering from dementia, to draw up a new will and to turn against her own children. Prosecutors say Niehaus used the money to buy a $460,000 home and be able to afford five cars.

“I believe it was her plan to leave her penniless and a ward of the state,” Lyons said Thursday in court. “She almost achieved it.”

Neither Black nor Lyons bought Niehaus’ apology. “I think the judge did what he could do with the sentencing guidelines (which called for between 57 and 71 months),” Lyons said after the sentencing. “I think her apology was very insincere.”

U.S. Assistant Attorney Brent G. Tabacchi said the sentence, which reflected prosecutors’ wishes, was fair and “reflected the seriousness of the offense and the nature of the victims.”

The Clines’ plight was first reported after local attorney Craig Matthews filed a civil lawsuit against Niehaus and her husband, Paul, whom Black called “an unindicted co-conspirator.”

“(Elder fraud) is something that we have seen more of within the last several years; it’s just a product of an aging population,” Tabacchi said. “We do have other investigations similar to this that are ongoing.

“Partly because of this case and the publicity it has received, people are much more aware of this type of fraud going on and are much more willing to reach out to law enforcement saying we’re seeing this kind of problem.”

Federal public defender Thomas Anderson said his client has “psychological distortions” and “major, major problems” but that Niehaus is “not today the same person she was” when she committed her crimes.

Anderson told Black he had a substantive objection on the length of the sentence imposed because Niehaus did not have a criminal record, though court documents show she was terminated from another bank for financial improprieties and once stole a family member’s identity to fraudulently obtain a loan and credit cards in the family member’s name.

Court records also show Niehaus used deceptive tactics such as: creating fictitious gift letters and fraudulent powers of attorney; engaging in complicated and layered financial transactions to conceal theft; falsely accusing a fellow employee; and falsely claiming to be a cancer survivor from a wealthy family with ties to Coca-Cola and Procter & Gamble.

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Ex-banker gets 5 years for defrauding elderly

Florida Resident Sentenced in Connection with International Lottery Scheme That Defrauded Elderly Americans

Charmaine Anne King was sentenced today in connection with her role in a fraudulent international lottery scheme that targeted U.S. citizens, the Justice Department announced.  King was sentenced by U.S. District Court Judge K. Michael Moore in Miami to serve 57 months in prison and 5 years supervised release.  A hearing on restitution has been scheduled for June 5, 2014.  King was convicted by a federal jury in Miami on Feb. 5, 2014, of one count of conspiracy, three counts of mail fraud, and two counts of wire fraud. 

King’s prosecution is part of the Department of Justice’s effort, working with federal and local law enforcement, to combat international lottery fraud schemes preying on American citizens.  According to the U.S. Postal Inspection Service, Americans have lost tens of millions of dollars to fraudulent foreign lotteries. 

“The Justice Department will continue to hold criminals accountable for fraudulent lottery schemes,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division.  “This illegal conduct creates significant financial harm to people throughout the country, and we will continue to investigate and prosecute such crime, and bring those responsible to justice.” 

A federal grand jury in Miami returned an indictment against King and co-conspirator Althea Angela Peart on Oct. 31, 2013.  Judge Moore adopted a report and recommendation accepting Peart’s guilty plea on Feb. 4, 2014, and on March 20, 2014, he sentenced Peart to 33 months’ incarceration.  As part of her plea agreement, Peart acknowledged that a co-conspirator, believed to be located in Canada, mailed letters to elderly victims in the United States falsely informing the victims that they had won more than a million dollars in a lottery.  These letters purported to be from an actual sweepstakes company in the United States.

“International lottery fraudsters have cheated Americans out of tens of millions of dollars,” said Wifredo Ferrer, U.S. Attorney for the Southern District of Florida.  “In this particular scheme, the fraudsters convinced the victims to deposit counterfeit checks into their bank accounts in order to pay fees to collect their purported lottery winnings.  After the victims sent the money to King, the counterfeit cashier’s checks bounced and they lost their money.  Such fraud will not be tolerated.  Together with federal and local law enforcement, we are working to put an end to this type of scheme.” 

The evidence at King’s trial showed that a co-conspirator sent fraudulent lottery letters to the victims and included counterfeit cashier’s checks made out to the victims for thousands of dollars.  These letters instructed victims to call “claims agents” who were actually co-conspirators, and when the victims called the purported claims agents, the agents informed the victims that they had to pay several thousand dollars in fees in order to collect their purported lottery winnings.  The claims agents told the victims to deposit the cashier’s checks in the victims’ bank accounts in order to purportedly cover the money they had to pay.  The co-conspirators instructed the victims on how to send and wire this money to King and others.  The cashier’s checks that victims received from the fraudulent lottery had no value.  The evidence demonstrated that after the victims sent money to King, the counterfeit cashier’s checks bounced.  Victims never received any lottery winnings.

Evidence presented at trial showed that King kept a percentage of the money she received from victims and sent the rest of the money to a co-conspirator.  King continued to participate in this scheme even after the U.S. Postal Inspection Service verbally informed her that she was participating in unlawful activity, and after she later signed a Cease and Desist Order requiring that she stop receiving money from victims of fraud.  The order that King signed described the lottery related activity that the U.S. Postal Inspection Service explained was unlawful.

 

Assistant Attorney General Delery commended the investigative efforts of the U.S. Postal Inspection Service, Homeland Security Investigations, and the U.S. Marshals Service.  The case is being prosecuted by Assistant Director Jeffrey Steger and Trial Attorney Kathryn Drenning with the Department of Justice’s Civil Division, Consumer Protection Branch.

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Florida Resident Sentenced in Connection with International Lottery Scheme That Defrauded Elderly Americans

Ex-Denver resident Akihiko Siegfried sentenced to 63 months in prison for defrauding elderly victim

DENVER - A former Denver man, who pled guilty to defrauding an elderly victim, was sentenced to 63 months in federal prison Wednesday.

Akihiko Siegfried, 55, was also ordered to serve a three-year term of supervised release following his prison sentence and pay $512,341.97 in restitution to the victim.

Siegfried was indicted by a federal grand jury in Denver on June 17, 2013. He pled guilty on Oct. 28, 2013 to one count of mail fraud and one count of money laundering.

According to the facts contained in the indictment as well as the stipulated facts contained in the plea agreement, in January 2008, Siegfried knocked on the door of the elderly victim's residence and when the door opened Siegfried pretended to be distraught and was crying.

Siegfried falsely told the victim that Siegfried's parents had just died in a car crash and that he had no money and no family to turn to for help.  Siegfried asked to borrow money.  The victim, who was then an 89-year-old widower of Japanese descent with little family, asked Siegfried if he was Japanese which he replied that he was.  He felt sorry for Siegfried and, in part because of their shared Japanese heritage, decided to help Siegfried.

Siegfried borrowed from the victim several times and in the middle of 2008 falsely told the victim he would inherit substantial money as a result of his parents' death, but that it would be tied up in probate for some time and he needed money for paying the associated fees and taxes. 

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Ex-Denver resident Akihiko Siegfried sentenced to 63 months in prison for defrauding elderly victim