The Securities and Exchange Commission has charged former broker Leonard Vincent Lombardo, his company and his business partner in an alleged real estate investment scheme that took $6 million from retirees and other investors.
The SEC alleges that Leonard Vincent Lombardo, who has been barred from the securities industry by Finra for about 20 years, operated the scheme from behind the scenes at his Long Island-based company, The Leonard Vincent Group, with assistance from its CFO Brian Hudlin. Mr. Lombardo once worked at Stratton Oakmont, which was expelled by the Financial Industry Regulatory Authority in 1998.
According to the SEC's complaint, more than 100 investors were defrauded with false claims that their money would be invested in distressed real estate, and some were told their investments had increased by more than 50% in a matter of months when in fact there were no actual earnings on their investments. Mr. Lombardo allegedly invested only a small fraction of the investor money in real estate and used the bulk of it for separate business ventures in the cigarette industry and personal expenses such as car payments, marina fees and visits to tanning salons.
The SEC said it received complaints from investors about how their investments were being handled, and the agency identified the perpetrators and gathered evidence to hold them accountable.
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The Leonard Vincent Group and Messrs. Lombardo and Hudlin have agreed to settlements that are subject to court approval.
Mr. Lombardo and his firm agreed to pay disgorgement of $5.88 million. He also pled guilty in a parallel criminal case brought by the U.S. Attorney's Office for the Eastern District of New York.
Without admitting or denying the SEC's allegations, Mr. Hudlin agreed to pay a $40,000 penalty.