Close Close
ThinkAdvisor

Regulation and Compliance > State Regulation > Florida

2 Veteran South Florida Lawyers Sentenced for Financial Fraud

X
Your article was successfully shared with the contacts you provided.

What You Need to Know

  • The fraud affected more than 3,600 investors in 42 states, prosecutors say.
  • The company at the center of the fraud, 1 Global, was a commercial lending business offering payday loans.
  • According to court documents, Ledbetter allegedly has fraudulently collected more than $100 million from investors since 2015.

Two South Florida securities lawyers and the former chief operating officer of 1 Global Capital LLC were sentenced for their roles in a sprawling fraud that prosecutors say affected more than 3,600 investors in 42 states.

One of the sentenced attorneys is Andrew Dale Ledbetter, 79, of Fort Lauderdale, who was also of counsel at 1 Global. He pleaded guilty to a single-count information, charging him with conspiracy to commit wire fraud and securities fraud. U.S. District Judge Roy K. Altman sentenced him Friday to 60 months in prison.

The second lawyer, Jan Douglas Atlas, 76, of Fort Lauderdale, was a partner at 1 Global and acted as its outside counsel.

Atlas pleaded guilty to a single-count information, charging him with conspiracy to commit wire fraud and securities fraud. He was also sentenced to eight months behind bars. The judge also ordered him to pay more than $29 million in restitution to the victims of the scheme.

The former 1 Global chief financial officer, Alan G. Heide, was previously charged via information and sentenced to 60 months.

Juan Antonio "Tony" Gonzalez, acting U.S. attorney for the Southern District of Florida. Courtesy photo Juan Antonio Gonzalez, acting U.S. attorney for the Southern District of Florida. Courtesy photo

The announcement came from Juan Antonio Gonzalez, acting U.S. attorney for the Southern District of Florida, George L. Piro, special agent in charge, Federal Bureau of Investigation Miami field office, Matthew D. Line, special acting agent in charge, Internal Revenue Service, Criminal Investigation, Matthew D. Line, acting special agent in charge, and Kyle A. Myles, special agent in charge, Federal Deposit Insurance Corp. Office of Inspector General.

Atlas’ defense counsel was Margot Moss and David Oscar Markus of Markus/Moss in Miami.

Markus said, “Both the judge and the prosecution in this case were wise in how they balanced all of the good that Jan has done in his life with what he did in this case, along with numerous other factors, including his remorse and cooperation.”

The company at the center of the fraud, 1 Global, was a commercial lending business based in Hallandale Beach. It offered “payday” loans to small businesses at high interest rates, via instruments termed merchant cash advance loans.

In order to attract investments, the owner of 1 Global, Atlas, Ledbetter and others made false and misleading representations to investors and potential investors in marketing materials and periodic account statements about to the profitability of 1 Global’s business.

But prosecutors say the scam unraveled as investors, investment advisers and regulators began to question the operation of the business; whether 1 Global was offering or selling a security; and whether the investment offering was required to be registered with the U.S. Securities and Exchange Commission.

Ledbetter and Atlas knew that if 1 Global’s investment offering were determined to be a security, it would undermine the ability of 1 Global to raise funds from retail investors and continue to operate without substantial additional expenses and reporting requirements, prosecutors said. Therefore, the lawyers knew that would undermine the profits and fees on which Ledbetter and other principals at the company would be able to obtain from 1 Global’s operation, prosecutors argued.

Around 2016, Atlas wrote two opinion letters which contained false information that he allegedly knew would be used by 1 Global to operate the business unlawfully, according to court documents. The letters falsely described how the investments worked, and included deceptive statements that omitted pertinent information, the press release from law enforcement stated.

According to court documents, Ledbetter allegedly has fraudulently collected more than $100 million from investors since 2015, through his own pitches and investment advisers he brought to 1 Global.

Ledbetter received $3 million from 1 Global, which came from commissions, and Atlas collected around $627,000 from him, prosecutors argued.

Ledbetter held himself out to investors and investment advisers as outside counsel to 1 Global, and also personally vouched for 1 Global in pitches and marketing materials, without disclosing his extravagant commissions, according to court filings.

Assistant U.S. Attorney Elizabeth Young is prosecuting the case.

Assistant U.S. Attorney Nicole Grosnoff is handling asset forfeiture related to the matter.

Ledbetter’s attorneys, Jeffrey Sloman and Erica Perdomo of Stumphauzer Foslid Sloman Ross & Kolaya in Miami, did not respond to requests for comment by press time.