SEC Charges Ex-Broker Accused of Stealing $1.2 Million from Elderly Investors
The Securities and Exchange Commission has charged a former broker with defrauding several elderly investors of more than a million dollars.
The Securities and Exchange Commission has charged a former broker with defrauding several elderly investors of more than one million dollars between October 2015 and March 2021.
The SEC alleges that Joseph DeGregorio solicited $1.2 million dollars from four investors, ages 78 to 94, by claiming that he would invest their funds into two private companies and a promissory note with a guaranteed 13 percent annual return.
According to the complaint, the promissory note was purportedly fake, and the private companies, which did not carry out any real business activities, were created by DeGregorio to facilitate his fraud.
The SEC alleges that DeGregorio misappropriated the vast majority of the investor funds “to pay for his living expenses, as well as for his drinking and gambling habits.”
He allegedly used a limited portion of the investor funds to make so-called “interest payments,” which helped “convince the investors that the promissory notes were genuine, thereby concealing and perpetuating his fraud.” In total, DeGregorio returned approximately $62,500 to investors in the form of the purported “interest payments,” the SEC said.
DeGregorio entered the securities industry in 2002 and was affiliated with 15 different broker-dealers until he was suspended by FINRA in 2017 for failing to pay a $23,500 arbitration award to his former firm, First Standard Financial Company. He was previously affiliated with Garden State Securities, Chelsea Financial Services, and MVP Financial.
DeGregorio has 13 disclosures on his BrokerCheck profile, of which roughly half are tax liens ranging in size between $1,100 and $212,200. The six customer disputes all allege unauthorized or unsuitable trading with settlement amounts ranging from $12,500 to $96,400.
The SEC’s complaint, filed in the United States District Court for the Eastern District of New York, charges DeGregorio with violations of the antifraud provisions of the federal securities laws.
He has agreed to settle with the SEC and be enjoined from future violations. The settlement is subject to court approval, while disgorgement, prejudgment interest and a civil penalty will be determined by the court at a later date.
In a parallel action, the U.S. Attorney’s Office for the Eastern District of New York has filed criminal charges again DeGregorio.
