What You Need to Know
- An ex-broker in Florida was sentenced to 87 months in prison and three years of supervised release.
- The judge also ordered him to pay $2.97 million in restitution.
- He had spent $1.3 million of clients' funds on gambling, jewelry, luxury cars, home mortgage payments, private school tuition and other personal items.
A judge sentenced an ex-broker to over seven years in federal prison on Thursday for directing a fraud scheme in which he sold stock in his Florida tech firm to clients across the U.S., and then misappropriated their funds for his own use, according to court documents, Juan Antonio Gonzalez, U.S. Attorney for the Southern District of Florida, and George L. Piro, special agent in charge of FBI Miami.
In addition to sentencing Isaac Grossman, 47, of Parkland, Florida, to 87 months (7.25 years) in prison, U.S. District Judge Raag Singhal ordered the ex-broker to serve three years of supervised release after prison and to pay $2.97 million in restitution, according to a sentencing document filed on Friday in U.S. District Court for the Southern District of Florida in Miami.
Grossman previously pleaded guilty to wire fraud, mail fraud and money laundering charges, with each count earning him a sentence of 87 months to be served concurrently.
The ex-advisor had spent $1.3 million of the clients’ money on gambling, diamond jewelry, luxury cars, home mortgage payments, tuition payments for his children’s private school education, and other personal expenditures, according to the indictment against him that was filed on Oct. 10, 2019.
Purchases included a McLaren MP4-12C, a Chevrolet Corvette, and a 4.81 carat diamond ring, Gonzalez and Piro said.
Grossman’s Fantasy Internet App
From September 2014 through April 2018, Grossman raised about $2.4 million in investor funds for his company, Dragon-Click Corp., by soliciting investments from 26 retirees across the U.S., according to the indictment.
Grossman told potential investors Dragon-Click was developing an internet application that would revolutionize online shopping by allowing a user to upload a photograph of any item the user wanted to buy, identify all retailers offering that item for sale, provide price comparisons for the item across retailers, and provide a link to retailers’ websites where the user could buy the item, the indictment said.
He solicited funds by falsely telling potential investors they would double, triple or quadruple their investments, and that Dragon-Click was on the verge of being sold to a large tech company such as Amazon, Apple or Google for more than $1 billion.