The U.S. District Court for the District of Nevada has unsealed indictments against Anthony Brandel, 46, of Las Vegas; Joseph Micelli, 59, of Las Vegas; James Warras, 67, of Waterford, Wisconsin; Sean Finn, 44, of Whitefish, Montana; Martin Schlaepfer, 55, of Zurich, Switzerland; and Hans-Jurg Lips, 50, of Zurich, Switzerland. Brandel and Micelli were arrested on December 12, 2013, in Las Vegas, and Warras was arrested on December 13, 2013, in Wisconsin. Finn, Schalepfer and Lips remain at large.
According to court documents, from October 2009 through October 2013, the defendants used a Swiss corporation known as Malom Group AG to promote investments in European equities and debt offerings, which they said would yield high rates of return.
The indictment alleges that the defendants created and provided to investors fake bank statements representing that Malom Group AG had large deposit balances at prominent European banks. The defendants collected payments of between $200,000 and $1.2 million per investor but did not put the funds toward the advertised investments. Instead, the defendants used the money for their own purposes.
Court documents allege that Brandel, Micelli, Finn, and Warras attempted to conceal the proceeds of the conspiracy by not filing tax returns with the Internal Revenue Service (IRS).
According to allegations in the indictment, the investments that the defendants promoted did not yield any returns to their victims. When victims complained, the defendants told investors that the Malom Group AG would refund their money with the proceeds of pending transactions the defendants knew were fictitious and would not generate any proceeds.
Despite the defendants' promises of refunds, court documents allege that none of the investors identified in the indictment received a refund. The indictment alleges that Micelli, Warras, and Lips went so far as to submit to a U.S. Bankruptcy Court declarations they knew contained false statements about a transaction that the Malom Group AG had promoted to an investor who had an interest in a company that had filed for bankruptcy protection.
According to the indictment, Anthony Brandel acted as the director of MY Consultants Inc., a Nevada corporation that purported to review potential investments for the Malom Group AG. Micelli, a disbarred former attorney, identified himself to victims as Malom Group AG's "compliance officer."
Warras served as Malom Group AG's executive vice president for U.S. Operations and Finn acted as a broker who recruited victims and referred them to Malom Group AG. Schlaepfer was Malom Group AG's chief executive officer, and Lips identified himself as the head of Malom Group AG's Structured Finance Group. Schlaepfer and Lips presently reside in Switzerland.
The case was investigated by the Las Vegas Field Office of the FBI. The Enforcement Division of the U.S. Securities and Exchange Commission, which referred the matter to the Department of Justice, provided valuable assistance and is conducting a parallel civil enforcement investigation.
The Public Prosecutor of the Canton of Zurich State Attorney's Office assisted with the investigation.
This case is being prosecuted by Trial Attorneys Brian R. Young, Stephen J. Spiegelhalter, and Anna Kaminska of the Criminal Division's Fraud Section, with assistance from the Criminal Division's Office of International Affairs and the Office of the United States Attorney for the District of Nevada.
--IBNS (Posted on 17-12-2013)