DA VANCE ANNOUNCES INDICTMENT OF THREE FLORIDA MEN IN PRECIOUS METALS INVESTMENT SCHEME
Manhattan District Attorney Cyrus R. Vance, Jr., announced the indictment of SEAN ROBERT STROPP, a/k/a “John Goldman,” a/k/a “Sean Roberts,” 31, KARL SPICER, 37, and RICARDO GARCIA, 32, for operating a fraudulent investment scheme through PMCO Services Inc. (“PMCO”), a company that purported to sell precious metals, resulting in millions of dollars in losses to numerous victims. STROPP, SPICER, and PMCO were indicted on charges of Grand Larceny in the Second Degree, Scheme to Defraud in the First Degree, violations of the Martin Act, and a violation of the General Business Law for failure to register with the New York State Attorney General as commodities brokers. GARCIA was indicted on charges of Scheme to Defraud in the First Degree and violations of the Martin Act.1
“Three Sunshine State scammers are charged with using a phony Wall Street address to trick unsuspecting investors into purchasing precious metals on leverage,” said District Attorney Vance. “Because New York is the financial capital of the United States, some companies, like the one named in this indictment, seek to set up ‘virtual’ offices on Wall Street. The Manhattan District Attorney’s Office will continue to vigilantly protect investors against those who seek to use New York’s reputation as a means to defraud others.”
According to the charges, from approximately February 2011 to July 2013, the defendants successfully solicited at least $8 million from at least 150 people throughout the United States and Canada to buy silver bullion and other precious metals held and sold under the umbrella of businesses controlled by STROPP, and in which SPICER and GARCIA were high-level officers. The defendants encouraged the victims to use their retirement savings, and steered them to risky, highly leveraged transactions. Consequently, many of the victims lost most or all of their investment through fictitious storage fees and significant interest assessments levied by the defendants, and large, up-front commissions.
The defendants are also accused of deceiving investors into believing that PMCO was a well-established Wall Street firm that held many metric tons of metals, employed hundreds of people, served large institutional clients, and managed trillions of dollars in metal assets. Virtual office services provided the defendants with Wall Street addresses, but were only used to forward mail and funds to the defendant’s Florida offices.
According to documents filed in court, STROPP often used aliases when speaking to potential investors and misled them about his experience and qualifications For instance, STROPP told one victim that his name was Sean Roberts, and that he had over 30 years in the metals industry, even though he was only 31 years old at the time. STROPP told another victim his name was John Goldman, and boasted that his clients included large insurance institutions and the New York Mets.
Assistant District Attorneys Michael Ohm, Deputy Chief of the Rackets Bureau, Marc Frazier Scholl, Senior Investigative Counsel in the Major Economic Crimes Bureau, and Brian Kudon are handling the prosecution of this case, under the supervision of Assistant District Attorneys Christopher Conroy, Deputy Chief of the Major Economic Crimes Bureau, Polly Greenberg, Chief of the Major Economic Crimes Bureau, and Executive Assistant District Attorney David Szuchman, Chief of the Investigation Division.
Rackets Investigators Gregory Dunlavey, Matthew Winters, and Senior Rackets Investigator Louis Capolupo assisted with the investigation, under the supervision of Supervising Investigator Donato Siciliano, Deputy Chief Investigator Michael Wigdor, Assistant Chief Investigator Richard Bellucci, and Chief Investigator Walter Alexander. Investigative Analyst Nicholas Werle, Margaret Abensur, Financial Intelligence Director of the Major Economic Crimes Bureau, and Robert Pomeroy, Consultant to Forensic Accounting and Financial Investigations, participated in the investigation, as did Trial Preparation Assistant Nicholas Frandsen.
District Attorney Vance thanked Chief Trial Attorney Jeff Le Riche and Senior Trial Attorneys Jennifer J. Chapin and Carlin R. Metzger of the United States Commodity Futures Trading Commission’s Kansas City and Chicago regional offices.
District Attorney Vance also thanked Diane Ridley Gatewood, Chief of Registration of the Investor Protection Bureau in the New York State Attorney General’s Office.
Defendant Information:
SEAN ROBERT STROPP, a/k/a “John Goldman,” a/k/a “Sean Roberts,” D.O.B. 11/19/1981
Jupiter, FL
Charges:
- Grand Larceny in the Second Degree, a class C felony, 4 counts
- Violation of the Martin Act, a class E felony, 5 counts
- Scheme to Defraud in the First Degree, a class E felony, 4 counts
- Violation of General Business Law for Failure to Register with the New York State Attorney General, a class E felony, 1 count
KARL SPICER, D.O.B. 8/01/1976
Boynton Beach, FL
Charges:
- Grand Larceny in the Second Degree, a class C felony, 4 counts
- Violation of the Martin Act, a class E felony, 4 counts
- Scheme to Defraud in the First Degree, a class E felony, 4 counts
- Violation of General Business Law for Failure to Register with the New York State Attorney General, a class E felony, 1 count
PMCO SERVICES, INC.
New York, NY
Charges:
- Grand Larceny in the Second Degree, a class C felony, 3 counts
- Violation of the Martin Act, a class E felony, 1 count
- Scheme to Defraud in the First Degree, a class E felony, 2 counts
- Violation of General Business Law for failure to register with the New York State Attorney General, a class E felony, 1 count
RICARDO GARCIA, D.O.B. 6/3/1981
West Palm Beach, FL
Charges:
- Scheme to Defraud in the First Degree, a class E felony, 2 counts
- Violation of the Martin Act, a class E felony, 1 count
1The charges contained in the indictment are merely allegations, and the defendants are presumed innocent unless and until proven guilty.