The U.S. Attorney's Office last week charged a recidivist fraudster experienced in real estate scams with yet another Ponzi scheme. Wilson Baston of Brooklyn allegedly used an investment fund to claim he was deploying investor money to fund real estate transactions in New York.
“As alleged, Wilson Baston used a fake name to conceal his prior convictions and to solicit more than $10 million as part of a series of brazen real estate scams against innocent New Yorkers," Damian Williams, U.S. Attorney for the Southern District of New York, said in a statement.
Sadly, too often convicted criminals like Baston, who pleaded guilty in 2008 to deceiving hundreds of investors in a Ponzi scheme and was released from prison in 2017, return to what they know best, financial advice industry sources said.
"The thing about most repetitive or chronic criminals is that they have a formula they use, and so a lot of times when they are arrested or do time, they get out and go right back to it," said Frank Congemi, a financial advisor with Beam Wealth Advisors Inc. who manages about $130 million in client assets and hails from Queens, New York. "That's why they're known as chronic, habitual, persistent offenders."
"Unfortunately, when you go to jail, you talk to other criminals and expand your crimes," Congemi added.
"The saying, a leopard doesn’t change its spots, is accurate," said Richard A. Roth, a securities industry attorney based in Manhattan. "They get out [of prison] and that’s all they know."
Baston is not a registered broker or financial advisor but presented himself to investors as having expertise in the real estate industry, according to the Securities and Exchange Commission, which filed a civil complaint last Friday, the same day the Justice Department announced its criminal charges.
Baton could not be reached to comment for this article.
After his release from prison, Baston began using aliases, including Chanon Gordon, and presented himself to investors as having expertise in the real estate industry, according to the SEC's complaint.
"He solicited investors to invest with Gordon Management Group, a purported real estate company, by telling them that their money would be used for the purpose of funding specific real estate transactions," the SEC said.
He gave investors short-term promissory notes, promised some investors a percentage of the profits, and then used the money to pay earlier investors and for his own personal expenses and benefits.
Baston, 62, faces one charge of wire fraud and one count of securities fraud, each of which carries a maximum sentence of 20 years in prison, according to the Department of Justice. He also faces one count of aggravated identity theft, which carries a two-year mandatory sentence.
Wealth Consulting Group, Coastline and Maridea report fresh capital, acquisitions and asset growth as advisor M&A keeps climbing
Carson Group's Dani Fava, Jason Pereira of Woodgate Financial, and Sally George of Convergency Partners led the raise as the growth-tech startup builds out its AI platform and leadership bench.
New teams from William Blair, Ameriprise and UBS bring more than $560 million in combined client assets to the firm's employee and independent channels.
Regulators this year approved UBS Bank USA’s conversion to a nationally chartered bank.
How a subprime lender’s car-loan bonds allegedly unraveled before bankruptcy.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
