Judge Calls Ponzi Schemer Who Raised Conspiracy Theory His Attorney Was Working With The Government A Liar, Sentences Him To 16 Years In Federal Prison

ponziblotterAnthony Vassallo pulled a page from Ponzi schemer Andy Bowdoin’s playbook when he advanced a conspiracy theory that his own defense counsel was working with the government to sell him down the river.

It didn’t work for Bowdoin, the 78-year old recidivist securities fraudster now serving a 78-month prison term after claiming he’d been “hoodwinked” by his lawyer.

Now, a similar claim hasn’t worked for Vassallo, 34. He is one of the purveyors of the Equity Investments Management & Trading (EIMT) Ponzi scheme in California, a crime that served up a heaping helping of the bizarre. Three individuals who led an alleged shakedown bid to recover money for investors were charged criminally in 2009, amid allegations they posed as federal agents.

The Sacramento Bee reported that Vassallo pleaded guilty to wire fraud on Feb. 1. After that, he tried to change his plea, claiming that government prosecutors and agents and a defense attorney “ganged up on him to extract a guilty plea to a crime he didn’t commit.”

But U.S. District Judge Garland E. Burrell Jr. called Vassallo a “liar” in court on Friday, sentencing him to 16 years in federal prison, prosecutors said.

“This lengthy sentence is justice served, though it is small comfort to the victims of Vassallo’s crimes, many of whom lost their homes, health, and retirements to this fraud,” said U.S. Attorney Benjamin B. Wagner of the Eastern District of California. “This case was unusual in its scope, but not in the nature of the fraudulent conduct.”

EIMT gathered more than $80 million before it began to unravel in late 2008, prosecutors said.

With EIMT foundering, “Vassallo continued to recruit new investments,” prosecutors said. “One investor transferred $250,000 to Vassallo’s account less than two weeks before Vassallo admitted to a group of investors that he had ceased trading and their money had been lost.”

“This was a classic Ponzi scheme, where you rob Peter to pay Paul,” said José M. Martínez, IRS-Criminal Investigation special agent in charge. “Eventually, you run out of Peters and Pauls.”

About the Author

Comments are closed.