REGULATORS ORDER SHUTDOWN OF BOGUS SECURITIES SCAM
REVOCATION OF LICENSES TO SELL INSURANCE ALSO SOUGHT
Regulators from the Florida Office of Financial Regulation (OFR) ordered the principals of a bogus real estate securities organization to cease operations immediately. Thomas Andrew Masciarelli, 47, of West Palm Beach, and Steven Paul Petrarca, 54, of Delray Beach, are charged with securities fraud and with the sale of unregistered promissory notes by unregistered persons. The scheme operated under the name American Income Real Estate Investments Inc. (AIREI).
“Kudos to our investigators for identifying this scam early on so more Floridians avoided being trapped in AIREI’s scheme,” said Florida’s Chief Financial Officer Tom Gallagher. “Consumers should be wary of investment offerings from unlicensed entities. Too often consumers invest in programs offering high rates of return only to discover that their life’s savings are gone. Now we will go after the licenses of these two and consider additional charges and penalties.”
Based on an investigation by the Division of Agent and Agency Services, administrative complaints have been filed which seek to revoke the agent licenses of Masciarelli and Petrarca on multiple counts of violation of the insurance code.
Masciarelli and Petrarca are believed to have defrauded at least 31 investors, from Florida and Rhode Island, of more than $1 million. Some of these victims had invested their entire life savings.
AIREI principals told victims they would use their invested dollars to purchase, rejuvenate and lease or sell real estate with guaranteed interest rates of 7 to 9 percent. AIREI never purchased any real estate and spent most of the money for personal use. To appear legitimate, AIREI sent phony statements to investors showing their accounts earning healthy rates of return.
Florida Commissioner of Financial Regulation Don Saxon acknowledged the fine work shown by OFR investigators in uncovering this scheme and also thanked the Securities Division of the Rhode Island Department of Business Regulation for their help on the case.
Floridians are urged to contact the Department of Financial Services at 1-800-342-2762 and Verify Before You Buy financial products, investments or securities. Make sure the institution or person offering investments or investment advice is licensed to operate in Florida.
Okeechobee County's historic courthouse, built in 1925, sits next to the county's new state-of-the-art courthouse scheduled to open this spring.