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Tuesday, February 14, 2023

Former Advisor Will get Over 3 1/2 Years in Jail for Fraud, Embezzlement

A New York-based former advisor will spend 3 1/2 years in jail after pleading responsible to embezzlement and defrauding a number of buyers, in addition to staff at his agency in a sequence of schemes.

Adam Belardino pleaded responsible final yr to 2 costs of wire fraud and one rely of mendacity to a authorities company earlier than being sentenced this week in a federal courtroom in White Plains, N.Y. Belardino is the previous CEO of The Maddox Group, and beforehand was affiliated with MML Traders Providers and MSI Monetary Providers, in line with his BrokerCheck profile. The Monetary Business Regulatory Authority barred him from the trade in Might 2021. 

Round August 2019, shortly after founding the Maddox Group, Belardino satisfied an unnamed 64-year-old consumer from New Rochelle, N.Y., he’d beforehand suggested to liquidate elements of her portfolio and switch it to Maddox accounts, in line with the Division of Justice. After she transferred greater than $330,000 to a Maddox account, Belardino used it to pay the agency’s payroll, workplace lease, prior debt, and bank card costs to repay private bills and journey.

In September 2021, the sufferer instructed Belardino she needed her Maddox portfolio transferred to an account at a brokerage agency. Till February of the next yr, the advisor despatched the consumer and her household emails and texts saying he was liquidating the portfolio to return the funds, despatched over paperwork detailing a forthcoming wire switch and deposited checks drawn from a Maddox account right into a checking account held by the sufferer.

However the wire transfers by no means arrived, and the checks bounced as a result of the Maddox account didn’t have enough funds to cowl them, in line with the DOJ. Throughout this time, Belardino continued to ship paperwork exhibiting Maddox had the cash to cowl the funds, and even instructed the sufferer’s household that his family would repay the consumer if he couldn’t.

In one other scheme, Belardino acted as an agent with an unnamed insurance coverage firm serving to a second consumer to use for a life insurance coverage coverage with a face quantity of $1 million that finally rose to $18 million in 2019. In April 2020, the advisor utilized for a $3 million coverage with a separate insurance coverage firm on behalf of the consumer, with out her information, and lied about their revenue, web value and well being. The corporate raised the face quantity of the coverage to $6 million in August 2020. 

Belardino additionally utilized for a 3rd coverage with yet one more insurance coverage firm for a similar consumer, once more with out her information or consent. He misrepresented details in regards to the consumer’s revenue and well being, main the coverage quantity to extend from $5 million to $12.1 million by Might 2021. In each conditions, Belardino paid the coverage premiums with out telling the consumer, nabbing practically $180,000 in commissions.

His scheming prolonged to staff on the Maddox Group, in line with the DOJ. He’d arrange 401(ok)s for workers, however from November 2020 till August 2021, Belardino withheld greater than $8,000 from 4 staff’ paychecks supposed for investments of their 401(ok)s. As an alternative, he spent the cash himself. 

An lawyer representing Belardino did not return a request for remark as of press time.

Along with the 42-month jail sentence, Belardino may have three years of supervised launch and pays practically $501,500 in restitution.

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