The U.S. Securities and Exchange Commission (SEC) has reached a $4.6 million final judgment to settle with the estate of a Michigan-based investment advisor who defrauded 100 investors with an “extreme day trading” investment program.
The judgment requires the estate of investment advisor Vincent James Saviano and his company, Palmetto Investments LLC, to pay $4.4 million in disgorgement and nearly $150,000 in interest.
Palmetto Investments Found to Be Fraudulent
The judgement comes three years after Saviano was found dead from an apparent suicide shortly after he confessed his fraud to several investors. After the confession, the SEC filed a suit against Saviano’s estate and Palmetto Investments. The SEC complaint states that Saviano touted success of the Palmetto investment program despite its massive trading losses and his use of investor money to fund his gambling habit.
Palmetto Investments Dupes More Than 100 Investors
According to the 2014 complaint, Saviano and Palmetto Investments started pitching investors in 2010, selling stakes in the “Palmetto Investment Portfolio,” which purported to make money through the “extreme” day trading of stocks.
To build investor confidence Saviano told investors in both oral and written communications that the fund had a historical track record of monthly returns ranging from 5 to 10 percent. He sent reports showing consistent gains in account balances, while assuring investors that a registered investment adviser was advising the fund.
Using this scheme Saviano and Palmetto were able to scam 100 investors, raising at least $1.96 million. According to the SEC, Saviano’s trading lost money in all but five months between 2011 and 2013. By the end of September 2014, the SEC alleged, Saviano had lost more than 80 percent of investors’ funds.
Funds Will Come from Receiver’s Efforts
In 2014, when the SEC filed suit, the court froze the assets of Saviano’s estate and Palmetto Investments, approving the appointment of a receiver over Palmetto. According to the SEC, the receiver’s efforts have included liquidating Palmetto’s assets and distributing more than $1 million of recovered money to eligible investors.
Did You Lose Money to Investment Fraud?
If you believe you have been the victim of investment fraud, you may have certain legal rights that require your immediate attention.
Call an Investment Fraud Attorney Today
If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.