Man Passed Out As Experienced Stock Trader And Took Over $ 200,000: Federal Government
A man posing as an experienced stock trader is accused of pocketing nearly a quarter of a million of an investor’s money for his personal use and of making “poor” investment decisions with a much of the rest.
In addition to the theft of $ 224,500, Gonzalo Ortiz also controlled, in total, nearly $ 600,000 of the victim’s money, losing a significant amount in transactions that were unprofitable despite his assurances to the contrary in the ploy that took place between 2015 and 2017, federal officials in New York City. said in a press release.
With the money he kept for himself, Ortiz used it for purchases, including food, clothing and car payments, officials said. Ortiz pleaded guilty to “fraud an investment adviser in connection with a scheme to defraud an investor” on November 29.
He “masqueraded as an experienced stock trader who could dramatically increase the victim’s savings,” Breon Peace, the attorney for the eastern New York district, said in a statement.
Ortiz, of Hackensack, New Jersey, convinced the victim, named “John Doe” in court documents obtained by McClatchy News, to cede control of approximately $ 565,000 to invest in the securities.
The “fraudulent scheme” began in April 2015, when Ortiz told the investor that he “was a successful stock trader and had made profits for other people by trading stocks on their behalf,” according to reports. court documents.
He offered to manage John Doe’s money, promising a 50% return each year.
In May 2015, Ortiz reportedly emailed the victim and pointed out some securities he said he would invest the victim’s money in.
He emailed the victim, saying that “the possibilities are very good and although it sounds too good to be true, in the position I am in I can tell it is for real,” reveal court documents. Then they entered into a written agreement, which authorized Ortiz to invest $ 100,000 of John Doe’s money which would be repaid by Ortiz within a year.
Ortiz also pledged a return of at least 50% on the first $ 100,000 investment, according to court documents, and assured that any gain up to $ 100,000 from trading the funds would be returned to the victim.
However, Ortiz is accused of stealing around $ 25,000 of the $ 100,000 investment, transferring it to his JPMorgan Chase bank account, and spending nearly $ 10,000 on car payments, clothes. and food.
The scheme continued with Ortiz and the victim making written deals for the second and third investments, officials said.
In late 2016, Ortiz “falsely told” John Doe that he had lost the first three investments, “totaling $ 400,000 through transactions,” court documents say.
But, officials said Ortiz “had not informed John Doe that he stole about $ 170,000 of these investments for personal use.”
As the scheme progressed, according to court documents, approximately $ 224,500 of John Doe’s money was funneled for personal use by Ortiz, who also lost some of his money due to business losses. .
“In fact, Ortiz made some bad business decisions,” the statement read.
“Investment fraud schemes are all too common, often causing emotional trauma in those affected,” Michael J. Driscoll, deputy director in charge of the FBI, said in a statement.
Ortiz faces up to five years in prison and a fine of up to $ 10,000, according to court documents.
He agreed to reimburse the $ 224,000 in compensation.
The press release and court documents obtained by McClatchy News did not include a sentencing date for Ortiz.
McClatchy News has contacted Ortiz’s attorney and the US attorney’s office for further comment.