4 sentenced in $3.6M securities fraud

4 sentenced in $3.6M securities fraud

	Published : Fri, 30 Mar 2007 16:17 By : Agencies Print this Story

NEW HAVEN, Conn. (AP) - Four New York men have been sentenced for their roles an alleged 'boiler room' investment scheme that federal prosecutors say scammed $3.6 million from more 270 people.

U.S. District Judge Janet C. Hall sentenced Viktor Novosselov, 39, of New York, N.Y. to 54 months in federal prison. Dmitry Kuperman, 32, of Staten Island received an 84-month sentence. Scott Ciappetta, 32, of Ronkonkoma, N.Y., was sentenced to 100 months in federal prison and Leslie James, 36, of Brooklyn, N.Y., was ordered to serve three months of home confinement. All four used one or more aliases in the scam.

They were indicted last year on several charges, including securities fraud, mail fraud and conspiracy. The sentences were handed down Wednesday and Thursday.

'We are pleased with these strict sentences, as boiler room schemes cripple the financial future of many and, in many cases, rob them of their retirement savings,' U.S. Attorney Kevin O'Connor said Thursday.

Federal prosecutors said under the scheme, investors were falsely informed that some of the defendants worked for Blue Square Management, which actually was a fraudulent company with no legitimate operations.

The defendants allegedly told potential investors during unsolicited 'cold' calls that they could buy securities in a company called Cash Money Lending Corp., which prosecutors say was another fictitious company.

The potential investors were told that CMLC had a lucrative business managing thousands of ATMs nationwide and that an initial public offering for CMLC or a buyout of the company was upcoming in the near future. The defendants allegedly told the investors that they would see significant profits from the IPO or buyout.

Hall also ordered Novosselov, Kuperman and Ciappetta to jointly pay back the $3.6 million to their victims. James was ordered to pay $70,000 in restitution. The defendants must all serve between three to five years of probation once they are released from prison.