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April 06, 2018 at 11:07 AM
A scene from the “Hamilton” musical.
Joseph Meli was sentenced by a federal court in Manhattan to more than six years in prison in connection with a multimillion-dollar Ponzi scheme involving purported resales of tickets to popular concerts and Broadway shows.
The criminal case arises from the same conduct alleged in two enforcement actions filed against Meli by the Securities and Exchange Commission in 2017.
Meli was arrested in January 2017 and later pleaded guilty to securities fraud. In connection with his plea, Meli admitted to raising millions of dollars from investors including by providing some investors with fake agreements containing fraudulent signatures that claimed to show Meli’s company had agreements with various production and management companies to purchase large blocks of tickets.
On Tueday, a federal court sentenced Meli to 78 months imprisonment followed by three years of supervised release, and ordered him to pay forfeiture in the amount of $104 million and restitution in an amount to be finalized at a later date.
In 2017, the SEC filed two enforcement actions against Meli in federal district court in Manhattan. In the first action, the SEC alleged that Meli and his co-defendants solicited investments for the bulk purchase and resale of tickets to popular Broadway shows and concerts, but used the majority of the more than $97 million raised to make payments to earlier investors and to enrich Meli, his family and a co-defendant.
In the second action, the SEC alleged that Meli and New York sports radio personality Craig Carton raised millions from investors by falsely claiming that they had access to large blocks of face-value tickets to popular concert performances. Instead of purchasing tickets for resale, Carton and Meli allegedly misappropriated at least $3.6 million to repay earlier investors and to cover other expenses, including Carton’s gambling debts.
The SEC’s litigation against Meli and his co-defendants remains ongoing.
Ex-Philadelphia Eagle to Pay $8M for Defrauding Coaches
A federal court entered a final judgment against former Philadelphia Eagles linebacker Merrill Robertson Jr., ordering him to pay $8 million in disgorgement for defrauding investors including former coaches.
In December, Robertson was sentenced to 40 years in prison.
In 2016, the SEC charged Robertson with defrauding mainly elderly investors, including former coaches he knew from his time playing football for the Fork Union Military Academy and the University of Virginia, out of $6 million.
Robertson was a Merrill Lynch broker from 2008-2009.
The SEC alleged that Robertson, Sherman Vaughn Jr., and the company they co-owned, Cavalier Union Investments LLC, promised to invest in diversified holdings but stole nearly $6 million of the more than $10 million they raised from investors.
They spent the stolen $6 million on personal expenses such as cars, family vacations, repayment of mortgage and credit-card debt, luxury goods, clothing, entertainment, educational expenses for family members, and a luxury suite at a football stadium. They also used the stolen money to make various donations and gifts to alma maters, churches and other third parties.
Robertson, who was criminally charged based on the conduct alleged by the SEC, was sentenced to 40 years’ imprisonment.
At the time of the alleged misconduct, Robertson was not registered as a broker, and Vaughn never was registered with the SEC.
SEC Charges New York Man With Insider Trading
The SEC charged a New York resident with tipping his brother and father with material nonpublic information about an upcoming corporate acquisition.
The SEC’s complaint alleges that, in 2014, Saverio Barbera learned that Owens & Minor Inc., a Virginia-based health care logistics company, was going to acquire all of the outstanding shares of medical products supplier Medical Action Industries Inc.
According to the complaint, Barbera then told his father and brother that they should purchase Medical Action stock in advance of the acquisition so that they could profit from the deal. The SEC alleges that Barbera obtained the information that he tipped to his father and brother from his close friend, the chief executive officer and a member of the board of directors of Medical Action.
According to the SEC’s complaint, soon after receiving this tip and less than a week before the public announcement of the deal, Barbera’s father and brother purchased a combined total of 22,000 shares of Medical Action common stock, which they then sold at a profit following the deal’s announcement. The SEC alleges that, as a result of their trading, Barbera’s father and brother realized combined trading profits of approximately $145,000.
Barbera has agreed to settle the SEC’s charges by paying a penalty of $289,650, an amount twice the trading profits of his father and brother.
