Broker Representative and Investment Adviser Indicted for Scheme to Defraud Investors
Litigation Release No. 24140 / May 14, 2018
Securities and Exchange Commission v. Leon Vaccarelli, et al., No. 3:17-cv-01471 (D. Conn., filed Aug. 31, 2017)
United States v. Leon Vaccarelli, No. 18-cr-92-SRU (D. Conn., filed May 2, 2018)On May 2, 2018, Leon Vaccarelli, a defendant in an ongoing SEC litigation, was indicted on multiple counts of mail fraud, wire fraud, and money laundering in connection with a scheme to defraud investors by representing that he would invest their money in various investment opportunities but instead used the money to pay his own business and personal expenses.
The criminal charges against Vaccarelli alleged in the indictment arise from the same conduct alleged in the SEC's complaint against Vaccarelli, individually and doing business as Lux Financial Services, and his company, LWLVACC, LLC, filed in federal court in Connecticut on August 31, 2017. According to the SEC's complaint, Vaccarelli fraudulently persuaded several elderly customers to invest with him. Instead of investing the customers' money in such things as conventional brokerage accounts and so-called separately managed accounts as promised, Vaccarelli allegedly deposited customer funds into his personal and business bank accounts. He allegedly commingled the funds with his own money and used them for his own purposes, and in some instances he used customer funds to pay returns to earlier investors. According to the SEC's complaint, Vaccarelli asked one customer to sign an agreement that she would not provide certain information to FINRA or the SEC. Vaccarelli also allegedly sold more than $450,000 in securities that were held in trust for the care and maintenance of a beneficiary and used some of the proceeds to pay business and personal expenses.
The SEC obtained a temporary restraining order and asset freeze against Vaccarelli and LWLVACC, LLC on August 31, 2017. The SEC's litigation against Vaccarelli and LWLVACC, LLC continues.
For further information, please see Litigation Release No. 23927 (August 31, 2017).