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SEC Charges Barred Broker and His Company with Defrauding Older Americans

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Defendant Promised Hefty Returns while Spending Investors’ Money on Luxury Goods

Washington D.C., Aug. 17, 2022 —

The Securities and Exchange Commission today charged Global Business Development and Consulting Corp. (Global) and its owner, Anthony J. Mastroianni, Jr., in connection with a $1.2 million fraudulent promissory note scheme targeting older Americans.

According to the SEC’s complaint, Mastroianni, a New Jersey resident, sold at least 11 investors promissory notes issued by his company, Global, beginning as early as 2017. The complaint alleges that Mastroianni induced investors, ranging in age from 64 to 82, to purchase the notes by promising exorbitant interest rates ranging from 50% to 175%. In 2016, Mastroianni  was barred by the Financial Industry Regulatory Authority (FINRA) from associating with any registered broker-dealer after refusing to appear for testimony to answer allegations of, among other things, excessive trading in an elderly customer’s account.

The SEC’s complaint further alleges that Mastroianni gave investors conflicting explanations of the nature of Global’s business, and often convinced them to roll-over their notes into new notes combining unpaid amounts with new investments by the investors. In reality, Global did not use investor monies to generate income and the SEC investigation determined that Mastroianni withdrew over $486,000 of investors’ money from Global’s bank account and also used ill-gotten funds for personal expenses on luxury items.

“We allege that Mastroianni preyed on older Americans with an all too familiar promise of massively high returns when in reality their money was being withdrawn in cash and spent on purchases at Disney resorts, Tiffany & Co., and Gucci,” said Sheldon L. Pollock, Associate Director of the SEC’s New York Regional Office. “We will continue to hold accountable those who target investors for their own financial gain.”

The SEC’s complaint, filed in federal district court in New Jersey, charges Mastroianni and Global with violating the antifraud provisions of the federal securities laws, and seeks disgorgement of ill-gotten gains with prejudgment interest, civil penalties, and permanent injunctive relief.  

In a parallel action, the U.S. Attorney’s Office for the District of New Jersey today announced criminal charges against Mastroianni.

The SEC’s Office of Investor Education and Advocacy has information and investor alerts to help seniors protect themselves against investment fraud. Additional resources and more can be found at investor.gov.

 The SEC’s investigation, which is ongoing, is being conducted by Peter A. Pizzani, Debbie Chan and Adam S. Grace, and the litigation will be led by Christopher Dunnigan and Mr. Pizzani of the New York Regional Office. The case is being supervised by Mr. Pollock.  The SEC appreciates the assistance of the U.S. Attorney’s Office for the District of New Jersey.

This news item was originally published by the US Securities and Exchange Commission (SEC US). For more information, see the Source Link.

Regulator Information

Abbreviation: SEC
Jurisdiction: United States

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