CAMDEN, N.J. (AP) — A northern New Jersey man involved in an investment fraud scheme that bilked investors out of millions of dollars has been sentenced to 33 months in prison.
Federal prosecutors say 31-year-old Carmelo Provenzano of Garfield also must pay more than $4.5 million in restitution to 13 victims under the sentence imposed Friday in U.S. District Court in Camden. He pleaded guilty in August 2012 to charges of wire fraud conspiracy.
Authorities say Provenzano was one of three conspirators involved in the Ponzi scheme. Forty-year-old George Sepero of Glen Rock, who led the scheme, recently received a 100-month sentence, while 43-year-old Daniel Dragan of Lebanon will be sentenced next month.
The men told investors they ran hedge funds that could deliver high returns on investments in foreign currency markets. The men claimed they had a secret computer program that had enabled them to achieve returns of more than 170 percent in the prior two years.
But authorities say the conspirators invested little or none of the money they received. Instead, they spent most of it on expensive cars, first-class vacations and hefty bar tabs for themselves.
To advance the scheme, the defendants emailed fake account statements to investors showing their principal had been invested and was achieving substantial results. Many of these emails were purportedly sent by an accountant named “Mel Tannenbaum,” a fictional character invented by Provenzano.
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