Leon Vaccarelli, a Connecticut-based broker and investment adviser previously charged by the Securities and Exchange Commission, was found guilty by a federal jury on 21 counts of fraud and money laundering charges in a parallel criminal case.
According to the SEC’s original complaint, Vaccarelli defrauded at least nine investors, several of whom were elderly, of more than $1 million. Instead of investing their money in such things as conventional brokerage accounts and separately managed accounts as promised, he deposited their funds into his personal and business bank accounts, and in some instances, used the customers’ money to pay back prior investors.
The criminal charges arose from the same conduct in the SEC’s complaint against Vaccarelli individually and doing business as Lux Financial Services, and his company, LWLVACC LLC, which were filed in a Connecticut federal court in August 2017. The SEC also obtained a temporary restraining order to stop the ongoing fraud and also froze his assets.
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. He also allegedly sold more than $450,000 in securities that were held in a trust for the care and maintenance of a beneficiary and used some of the proceeds to pay business and personal expenses.
Vaccarelli, who held FINRA Series 7 and 66 licenses, was affiliated with The Investment Center Inc. since 2011, until he was fired for failing to comply with company policy regarding access to his office and computer during an examination. He entered the securities industry as a broker in 1999 and was previously affiliated with QA3 Financial, Ameriprise, and IDS Life Insurance Company.
Vaccarelli’s sentencing is scheduled for August 22, 2019.