One of the founders of Medical Capital Holdings Inc., the issuer of tainted private placements that have devastated dozens of broker-dealers, faces five counts of failing to file a federal income tax return.
One of the founders of Medical Capital Holdings Inc., the issuer of tainted private placements that have devastated dozens of broker-dealers, faces five counts of failing to file a federal income tax return on $6.2 million in income between 2004 and 2008.
It was during that time that dozens of independent broker-dealers sold $2.2 billion in allegedly fraudulent MedCap private placements. Regulators estimate that about half of investors’ principal, about $1.1 billion, was lost.
The charges against Joseph J. Lampariello, former president and chief operating officer of Medical Capital, were lodged Oct. 14 in U.S. District Court for the Central District of California. He also faces a 2009 complaint from the Securities and Exchange Commission alleging that he and his partner, Sidney M. Field, ran a massive “Ponzi-like” scheme through Medical Capital.
Mr. Lampariello’s attorney, Michael Piazza of Greenberg Traurig LLP, didn’t return a call seeking comment.
Mr. Field hasn’t been criminally charged.
Dozens of broker-dealers that sold MedCap private placements and oil and gas private placements issued by Provident Royalties LLC have gone out of business. Firms that sold MedCap offerings, but not Provident notes, and have closed include Core Pacific Securities USA LLC, Cullum & Burks Securities Inc., Fortune Securities Inc. and Signature Financial Inc.
Medical Capital promised thousands of investors lucrative holdings in medical receivables, including billings for hospitals. A court-appointed receiver has determined that most of the receivables didn’t exist, and that the company had invested in several nonmedical projects, including a yacht named the “Home Stretch” and a movie about a Mexican Little League baseball team.
