Ex-broker pleads guilty to 18-year Ponzi scheme, costing elderly investors $9 million

A former broker from Long Island, N.Y., pleaded guilty Monday in federal court to conspiracy to commit mail and wire fraud for running a Ponzi scheme over 18 years. In all, the victims of the ex-broker, Steven Pagartanis, invested over $13 million and saw actual losses of more than $9 million, according to a statement by the U.S. Attorney's office. Mr. Pagartanis, 58, solicited elderly victims to invest in real estate-related investments, including those affiliated with publicly traded entities, a Canadian company and an international hotel conglomerate, according to the Department of Justice. He promised the victims that their principal would be secure and earn a fixed return, which he typically claimed to be between 4.5% to 8% annually, according to the statement. The victims wrote checks payable to an entity secretly controlled by Mr. Pagartanis at his direction, according to the government. He utilized a network of bank accounts to launder the stolen funds, which he used to pay personal expenses, buy luxury items and make the phony interest or dividend payments to other victims, according to the Department of Justice. He faces up to 20 years in prison. Mr. Pagartanis was registered with Lombard Securities Inc. from September 2017 through this March. He was registered with 14 firms over 28 years, according to his BrokerCheck report, with 16 disclosure events on his record. Mr. Pagartanis was fired by Lombard in March after failing to respond to customer complaint questions and requests for information.