Former Long Island Liquor Distributor Sentenced to 24 Months in Prison for Defrauding Investors in Wine Product Featured on "Shark Tank" TV Show / Defendant Stole More Than $500,000 from Investors to Fund His Securities Trading Account and Satisfy Mortgage on a Florida Home (DOJ Release)Federal Court Orders Pennsylvania Man and His Companies to Pay More Than $1.2 Million in Forex Trading Scheme (CFTC Release)
In December 2012, Falcone established 3G'S, which was based in Bethpage and Farmingdale, New York. Among other products, 3G'S distributed a single-serving wine in a sealed glass, which was featured on the television program "Shark Tank." Between September 2014 and November 2015, Falcone solicited investments and promised potential investors that their money would be used to fund 3G'S by purchasing the single-serving wine product. Relying on those promises, investors wired money to bank accounts in Florida controlled by Falcone. Rather than invest the money as promised, Falcone used approximately $527,064 for his personal benefit - paying off the mortgage on a residence in Florida and funding his online securities trading.
The CFTC initiated revocation proceedings against Phy Capital and Bretas on May 7, 2020. [See CFTC Press Release No. 8163-20] CFTC Judgment Officer Kavita Kumar Puri issued an Initial Decision on Default on August 31, 2020, which was finalized on September 30, 2020. Puri found that Phy Capital and Bretas are subject to statutory disqualification from CFTC registration based on an order entered by the U.S. District Court for the Southern District of New York that, among other things, (1) found that Phy Capital and Bretas misappropriated commodity pool funds and issued false quarterly statements to pool participants, (2) permanently enjoined Phy Capital and Bretas from further violations of the anti-fraud provisions of the Commodity Exchange Act, as charged, and (3) ordered Phy Capital and Bretas jointly and severally to pay more than $17.2 million in monetary relief. [See CFTC Press Release No. 8052-19]Puri also found that Bretas is subject to disqualification from CFTC registration based on his conviction for conspiracy to commit commodities fraud and wire fraud in connection with the same activities, as entered by the U.S. District Court for the Southern District of New York on February 28, 2020. [See Case No. S3 19 Cr. 257 (LTS)]
The CFTC charged that beginning in at least January 2017 and continuing through at least March 2018, Salerno and his Pennsylvania companies solicited individuals on websites such as LinkedIn and Indeed.com and their own websites to become forex traders. Defendants required prospective traders to pay risk deposits that defendants falsely promised to match with some multiple of company funds in proprietary forex trading accounts, and falsely promised to share a portion of the trading profits with the traders and to pay performance bonuses. They also falsely touted Salerno's successful forex trading career, and falsely assured prospective traders that Salerno had amassed no less than $9.5 million in real estate sales that he was using to fund his proprietary trading companies. In reality, Salerno had not traded successfully in the forex markets, had filed for bankruptcy in the same year he claimed to have made real estate sales, and had been convicted of a felony and sentenced to 21 months in prison in 2005. Moreover, defendants never established live trading accounts for anyone, and misappropriated the risk deposits.
"A limited number of customers appear to have had their Robinhood account targeted by cyber criminals because of their personal email account (that which is associated with their Robinhood account) being compromised outside of Robinhood," a spokesman for the company said in an email. "We're actively working with those impacted to secure their accounts."