A jewelry wholesaler from Melville was charged Tuesday at federal court in Brooklyn with leading a $200 million Ponzi scheme, officials said.
Gregory Altieri, the president of LNA Associates, was charged with one count of wire fraud for allegedly running a two-year, $200 million Ponzi scheme based on nonexistent wholesale jewelry deals and false promises of inflated returns, according to the U.S. Justice Department’s Eastern District of New York.
Altieri pleaded not guilty.
He was released on a $750,000 bond.
His attorney, Edward Sapone, told reporters that Altieri would be fighting the charges.
Officials say that in August of 2017 Altieri allegedly solicited between $75 million to $85 million from more than 80 investors from Queens, Staten Island, Long Island and other areas to purchase jewelry at closeout prices and resell it at a high profit.
Altieri promised returns of between 30 and 70 percent within months, officials said.
Although Altieri initially bought jewelry with investors’ money, by 2018, officials say he began to use new investors’ money to pay earlier investors, leading those earlier investors to believe they were receiving returns on their investments. With this pattern, Altieri convinced the earlier investors to keep their money with LNA Associates, by “rolling over their investments into new investments based on false promises to use this money to purchase additional jewelry,” according to the Justice Department.
By January 2020, when Altieri stopped making paybacks to investors, he owed them nearly $200 million based on the falsely inflated promised returns.
“As alleged, Altieri defrauded investors, including retirees living off their pensions, by representing that he was buying and reselling jewelry for big profits, which was a lie,” Acting U.S. Attorney Seth DuCharme said in a statement.
“Stealing millions based on false promises made to retirees who rely on their pensions is contemptible,” FBI Assistant Director-in-Charge William Sweeney said in a statement. “We allege Mr. Altieri knew he was going to have problems paying off his first round of investors, but he kept his con going anyway.”
