The Securites and Exchange Commission [1] (SEC) filed fraud charges against a former Florida-based stock promoter, Robert J. Vitale, who is currently serving a two-year prison term for lying to SEC investigators. The SEC's complaint charges Vitale with defrauding investors in a Florida real estate venture, selling unregistered securities, and acting as an unregistered broker-dealer.
Vitale and his company, Realty Acquisitions & Trust Inc., raised $8.7 million from investors, many senior citizens. Vitale claimed to be a "financial expert," and that his funds were "100% protected."
The SEC alleges that Vitale failed to tell his investors he was previously charged by the SEC for participating in a pump-and-dump market manipulation scheme, as well as failing to mention he was barred from the brokerage industry as part of the settlement.
"We are gratified that the criminal authorities held Mr. Vitale responsible for his attempts to derail our investigation," said Andrew J. Ceresney, director of the SEC's Division of Enforcement. "His prison sentence and our determination to uncover and charge his underlying misconduct notwithstanding his obstruction show how seriously we and our law enforcement partners take our missions."
The SEC is seeking to return to investors money lost plus interest, an additional monetary penalty, and a permanent injunction against Vitale.
"Vitale hid the truth from investors just as he tried to hide his assets during our investigation," said Stephen L. Cohen, associate director of the SEC's Division of Enforcement. "When individuals barred from the industry continue their wrongdoing, we pursue them aggressively and seek to return their ill-gotten gains to investors."