BIRMINGHAM, Alabama Jan 25 2013- A Jefferson County circuit judge has sentenced a Hoover man to 10 years in prison and ordered him to pay $5.3 million in restitution to 26 people he defrauded in what authorities described as a Ponzi scheme.
Circuit Judge Tommy Nail on Jan. 17 ordered Spero Vourliotis to begin serving his prison sentence immediately.
Vourliotis pleaded guilty in September to one felony count of securities fraud and admitted he started legitimate investment clubs, but began filing false statements to retain clients and bring in new ones after the investments quickly soured.
Three-dozen people invested a total of $7.5 million in Capstone Group, Cornerstone Investment Group and Tristone Investment Group between 1999 and 2011, said Steve Feaga, deputy director of enforcement and prosecution with the Alabama Securities Commission, during a plea hearing in Jefferson County Circuit Court. About $1.6 million was paid out to clients, but 26 investors lost all of their money, Feaga said.
The initial investors, many of whom were from Hoover, were paid from capital derived from subsequent investors rather than from actual earned profits, according to the Securities Commission. Neither Vourliotis nor the companies he represented were registered to conduct securities business in Alabama, as required by Alabama law.
"This case is a classic example of "affinity fraud," where the victims are often friends or members of a close-knit community," Alabama Securities Commission Director Joseph Borg said in a written statement issued today. "In addition to the serious loss of money, the resulting betrayal in a community is painful and damaging to the individuals, their families and the community as a whole. The penalty for this betrayal of community trust in this case was just and will send a strong message to other scam artists, con men and criminals tempted to cheat citizens out of their hard earned money."
Borg commended people in the office of Jefferson County District Attorney Brandon Falls and members of the Alabama Securities Commission enforcement division for bringing a measure of justice to the people who were injured by Vourliotis' actions.
Carey Michael Billingsley, a man from Rockford who helped recruit investors into the scheme, pleaded guilty to selling unregistered securities. Nail on Nov. 5 sentenced Billingsley to two years in prison but suspended the sentence and placed him on three years of probation. Nail also ordered Billingsley to pay $350,000 in restitution to eight investors he helped recruit. Billingsley paid $50,000 at sentencing and was required to pay the other $300,000 by June 1.
Both Vourliotis and Billingsley were permanently barred from selling securities.
The Alabama Securities Commission cautions potential investors to thoroughly scrutinize and research any investment opportunities and offers. The commission urges people to report suspected fraud to its office or call the office with inquiries about securities dealers, investment advisers and financial planners.
For more information, contact the Alabama Securities Commission at 334-242-2984 or 1-800-222-1253, or visit the commission's website at www.asc.alabama.gov.
source-al.com
Circuit Judge Tommy Nail on Jan. 17 ordered Spero Vourliotis to begin serving his prison sentence immediately.
Vourliotis pleaded guilty in September to one felony count of securities fraud and admitted he started legitimate investment clubs, but began filing false statements to retain clients and bring in new ones after the investments quickly soured.
Three-dozen people invested a total of $7.5 million in Capstone Group, Cornerstone Investment Group and Tristone Investment Group between 1999 and 2011, said Steve Feaga, deputy director of enforcement and prosecution with the Alabama Securities Commission, during a plea hearing in Jefferson County Circuit Court. About $1.6 million was paid out to clients, but 26 investors lost all of their money, Feaga said.
The initial investors, many of whom were from Hoover, were paid from capital derived from subsequent investors rather than from actual earned profits, according to the Securities Commission. Neither Vourliotis nor the companies he represented were registered to conduct securities business in Alabama, as required by Alabama law.
"This case is a classic example of "affinity fraud," where the victims are often friends or members of a close-knit community," Alabama Securities Commission Director Joseph Borg said in a written statement issued today. "In addition to the serious loss of money, the resulting betrayal in a community is painful and damaging to the individuals, their families and the community as a whole. The penalty for this betrayal of community trust in this case was just and will send a strong message to other scam artists, con men and criminals tempted to cheat citizens out of their hard earned money."
Borg commended people in the office of Jefferson County District Attorney Brandon Falls and members of the Alabama Securities Commission enforcement division for bringing a measure of justice to the people who were injured by Vourliotis' actions.
Carey Michael Billingsley, a man from Rockford who helped recruit investors into the scheme, pleaded guilty to selling unregistered securities. Nail on Nov. 5 sentenced Billingsley to two years in prison but suspended the sentence and placed him on three years of probation. Nail also ordered Billingsley to pay $350,000 in restitution to eight investors he helped recruit. Billingsley paid $50,000 at sentencing and was required to pay the other $300,000 by June 1.
Both Vourliotis and Billingsley were permanently barred from selling securities.
The Alabama Securities Commission cautions potential investors to thoroughly scrutinize and research any investment opportunities and offers. The commission urges people to report suspected fraud to its office or call the office with inquiries about securities dealers, investment advisers and financial planners.
For more information, contact the Alabama Securities Commission at 334-242-2984 or 1-800-222-1253, or visit the commission's website at www.asc.alabama.gov.
source-al.com