Hedge Fund Manager Sentenced in Massive Annuities Fraud Claim
By Jessica Tyner
Annuity and life insurance fraud is big business for some investors and even entire companies. However, it’s the story of hedge fund manager George Sepero that’s really making headlines.
In October 2013, Sepero received a 100 month sentence in a federal prison after being found guilty of conning a paraplegic elderly woman out of her entire life savings. He was also convicted of defrauding additional victims for over $4 million.
According to court documents, Sepero worked with two other “partners” in order to live the high life off of his victims. He collected luxury vehicles, traveled the world and racked up five-figure tabs at bars all on the shoulders of his annuity and life insurance victims.
The evidence of the lavish lifestyle led by Sepero is daunting. He averaged $25,000 per month on credit cards, was generous enough to leave a $4,000 tip on an $18,241 bar tab, and spent over $14,000 per night partying at Drai’s Hollywood club in Los Angeles. His average hotel room at W hotels in Manhattan was $4,000 and he flitted to Chicago, Los Angeles and Paris on his customer’s funds.
Sepero wasn’t just a hedge fund manager, he was also an entrepreneur. As the owner of “Casa Nostra Enterprises,” he also splurged on a custom $80,000 Ford F-350 Harley truck, and one of his friends bought a luxury Range Rover for $71,000. The annuity complaint states that Sepero was behind his friend’s splurge as well. Mortgage payments, lavish meals, limos, jewelry and home improvement projects were also funded on his victim’s accounts. According to court records, one of Sepero’s investors lost $2.1 million in the shady dealings.
Sepero was put into federal custody on July 16, while he was already on supervised release for similar accusations. However, US Attorney Paul Fishman said that Sepero continued defrauding people even while on watch. Sepero had already pled guilty in March 2013 for conspiracy, tax evasion and wire fraud, wholly admitted to using faux screen shots in order to lure investors. He told his clients that he had a “secret computer algorithm” that would let them receive incredible 170 percent returns (and more) during a time when the financial markets were not that solid. Fishman calls Sepero’s work a “Ponzi scheme” and that he “perpetrated a monstrous fraud on an elderly woman who was the definition of vulnerable. Blowing fortunes of other people’s money, he continued to commit scam after scam until he was locked up. It is fair that he spend his next years away from the society he victimized.”
However, the particular elderly woman who was a victim of this annuity scheme is just one example of many. Other victims may not realize what happened, or may have not stepped forward yet. Victims of Sepero can take solace in the fact that federal convicts usually serve their entire sentence without the option of parole. It’s suspected that Sepero will be in prison for at least eight years. He pled guilty along with his cohorts, Daniel Dragan and Carmelo Provenzano, for all 17 counts. Currently, the other two men are still awaiting sentencing.
The End of the Ride
Sepero has been watched for years—in fact, two years ago, one of his investors met with him while wearing a wire. It’s on record that Sepero told this investor that all of the money was “traded and lost,” but reassured him with a paper trail. “The only money I ever kept was money that was paid to me for commissions. End of story,” Sepero told the investor. Sepero’s home and vehicles will soon be seized. According to Fishman, the purpose of Sepero’s business was to steal millions from those who trusted him.
“With other people’s cash in their pockets, they went on a spending spree,” says Fishman. However, Sepero did try to cover his tracks. They emailed fake statements to their victims, including fake screen shots of a supposed trading program. In the case of the elderly woman, Sepero took over her annuity account and encouraged her to write checks to companies that he was in charge of. He promised her that he’d add her money to accounts, but instead spent it all.
Are You the Victim of an Annuity Scheme?
If you believe you’re the victim of such a scheme, you may quality for an annuity legal claim. This is an extreme case, but many people who believe they were made promises which weren’t kept or their funds didn’t perform as they were told may qualify. Find out more at the Life Insurance, Annuities Fraud Class Action Lawsuit Investigation site today. After submitting your information, an attorney will contact you if you have a case for a complimentary annuity claim review.
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