8 June – LAWFUEL – The Law News Network – Marcos Daniel Jiménez, United States Attorney for the Southern District of Florida, and James K. Belz, Inspector-in-Charge, Miami Division, United States Postal Inspection Service, announced today that defendant, Gregory Swarn, a former resident of Miami Beach, Florida, together with defendants, Craig Moncrieffe and John Eckhardt, both Broward County residents, were sentenced in United States District Court in Miami, Florida on May 31, 2005 in relation to charges arising from a federal Indictment returned on November 30, 2004. According to the Indictment, Case No. 04-20926-CR-HUCK, all three (3) defendants conspired to operate a multimillion dollar securities fraud scheme, which targeted foreign investors by means of various elaborate boiler room telephone solicitation schemes based in Miami and later planned for operation in the Dominican Republic.
Defendants Swarn and Moncrieffe pleaded guilty before United States District Court Judge Paul C. Huck to Count One of the Indictment, which charged him with conspiracy to commit wire fraud, in violation of Title 18, United States Code, Section 1349. Defendant Eckhardt pleaded guilty to Count 12 of the Indictment, which charged a separate wire fraud conspiracy involving Swarn and Moncrieffe.
The Court sentenced Swarn to eighty seven (87) months’ confinement, followed by a term of supervised release of three (3) years and $927,396.38 in restitution to victims in Case No. 04-20926-CR-HUCK and, in relation to case No. 03-60244-CR-ZLOCH, a term of sixty (60) months’ confinement and three (3) years supervised release, to run concurrent with Case No. 04-20926-CR-HUCK, along with an additional $779,785.00 in restitution to those victims. The Court sentenced defendant Moncrieffe to fifty one (51) months’ confinement, followed by three (3) years of supervised release and $927,396.38 in restitution to victims. Defendant Eckhardt was sentenced to forty six (46) months’ confinement, followed by three (3) years of supervised release.
According to the Indictment, from approximately May of 2002 to February of 2004, Swarn and Moncrieffe, together with numerous other co-conspirators, conducted the call center portion of the boiler room operation from offices in Miami-Dade County. The defendants’ scheme involved the making of unsolicited telephone calls to foreign investors whose names had been acquired from various so-called “lead” databases. In these telephone calls, Swarn, Moncrieffe, and others allegedly posed as representatives associated with certain purported financial services firms. During these solicitations or “pitches,” the defendants proposed certain enticing stock swap or straight stock purchase transactions, all of which were actually fraudulent and non-existent from the inception, but which, according to the defendants who assumed the role of firm representatives, required the investor-victim to wire certain pre-transaction advance payments. In addition, the defendants are alleged to have later contacted these same victims by telephone, claiming that federal regulatory agencies, such as the S.E.C., had reviewed the victim’s pending stock transaction, and were now requiring that the victim advance even more sums of money before the proposed securities transaction could be finalized. As further alleged in the Indictment, the defendants acquired in excess of one million dollars from unsuspecting victims from numerous foreign countries by the time this scheme had run its course.
From June 2004 through November 12, 2004, Eckhardt participated in a conspiracy to establish a securities fraud boiler room operation, along with co-defendants Swarn and Moncrieffe, in the Dominican Republic. Eckhardt met on a number of occasions for the purpose of discussing the necessary preliminary details attendant to the establishment of the boiler room operation’s call center in Santo Domingo. During these meetings, which were recorded at an undercover office in Hollywood, Florida, the group of three (3) (with Swarn participating by telephone from his then residence in Thailand) are alleged to have discussed various aspects of their proposed fraudulent operation.
Mr. Jiménez commended the investigative efforts of the United States Postal Inspection Service, as well as the Federal Bureau of Investigations, which provided assistance in the apprehension of defendant Swarn in the Dominican Republic. In addition, Mr. Jiménez expressed gratitude to law enforcement officials of the governments of Australia, New Zealand, Denmark, Singapore, Sweden, and Norway, all of whom expended considerable efforts in assisting the United States Attorney’s Office in locating numerous citizens of those countries who had been victimized by this fraud scheme, as well as providing invaluable foreign witness liaison assistance with these same victims. Furthermore, Mr. Jiménez expressed thanks to prosecutors and law enforcement officials in the Dominican Republic, who assisted in the eventual expulsion and turnover of defendant Swarn to awaiting F.B.I. agents. Finally, Mr. Jiménez expressed a special note of gratitude to the United States Securities and Exchange Commission, whose attorneys and other staff were of invaluable assistance in assisting with the investigation. This case is being handled by Assistant United States Attorney Peter B. Outerbridge and Special Assistant United States Attorney Christopher Stidvent (on detail from the S.E.C.).
A copy of this press release may be found on the website of the United States Attorney’s Office for the Southern District of Florida at www.usdoj.gov/usao/fls . Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or on .
