A Florida defendant who was facing charges of wire fraud in connection with a federal securities case has pleaded guilty to conspiracy to commit the crime. The defendant, who had owned a day-trading firm in Tampa, was facing the white collar crime allegations after he allegedly defrauded customers out of more than $470,000. He could face up to five years’ prison time for his involvement in the alleged financial scheme. That 34-year-old man is implicated in both a criminal case and a federal lawsuit that was brought by an investor.
The defendant and several of his associates are accused of falsely representing themselves as licensed agents who complied with securities laws. Although the man said that he had a degree from the University of South Florida, school records show that he never enrolled at that institution. Further, the man did not complete the required registration with the Securities and Exchange Commission to operate his day-trading firm. Further, an investigation revealed that the man and his business partners misrepresented other aspects of their services, as they did not have a secured escrow account or even segregated trading accounts.
Authorities say that they were alerted about the problems when an investor wired a $50,000 payment to open an account with the group. When he checked his balance, he found that $20,000 had been removed. The man discovered that only a portion of his money had been sent to the firm’s master account; the rest had been removed through cash withdrawals.
The defendant in this case has chosen to plead guilty, which means that his white collar crimes case will not proceed to trial. This can be an expedient option for defendants whose legal teams believe a conviction is likely during a jury trial. Although plea agreements are useful for some criminal cases, they are not right for everyone; careful consideration should be exercised before a formal plea is entered in a securities fraud case.
Source: Tampa Bay Times, “Tampa day-trader firm accused of defrauding customers“, Patty Ryan, July 6, 2014