Wall Street Investment Chief Gets 100 Months’ Prison For $13 Million Ponzi Scheme

United States Attorney
Southern District of New York
FOR IMMEDIATE RELEASE CONTACT: U.S. ATTORNEY’S OFFICE
LawFuel.com –
LEV L. DASSIN, the Acting United States Attorney for
the Southern District of New York, announced that HAYIM
REGENSBERG, president of Manhattan investment firms, was
sentenced today to 100 months in prison for operating a $13
million investment fraud and Ponzi scheme. REGENSBERG was
convicted on securities and wire fraud charges on April 3, 2009,
following a five-day jury trial. United States District Judge
VICTOR MARRERO imposed the sentence today in Manhattan federal
court.

As established by the evidence at trial and statements
made during today’s sentencing proceeding:

From 2004 to September 2007, REGENSBERG raised money
from investors by representing he would invest their funds in one
of two ways: by investing in foreign initial public offerings
that would purportedly deliver returns of between 5 percent and
15 percent, with little or no risk; and by lending invested funds
to trading firms that would use the funds merely as collateral
and that would purportedly return a high fixed annual rate of
return of up to 18 percent, subject only to the low risk that a
trading firm might collapse.

In fact, REGENSBERG made no such investments. Instead,
he invested and lost large portions of investor money in highly
speculative and risky trading, such as domestic options trading,
completely unrelated to the investment strategies he represented
he would employ; he also diverted significant amounts of investor
funds to himself and his relatives. REGENSBERG also paid out to
earlier investors monies he took in from later investors, thereby
perpetrating a Ponzi scheme. Late in the course of his scheme,
when some investors demanded that he prove where their money was
located, REGENSBERG provided a forged bank statement purporting
to show he had approximately $9 million of investor funds in his
bank account. In fact, the account contained only approximately
$9,000. REGENSBERG’s scheme caused investor losses totaling more
than $13 million between 2004 and September 2007.
REGENSBERG, 44, resides in Manhattan.

In addition to the prison term, Judge MARRERO ordered
that REGENSBERG pay almost $13.5 million in restitution to the
victims of the crime.

Mr. DASSIN praised the Criminal Investigators of the
United States Attorney’s Office for the Southern District of New
York for their work in this case.

Assistant United States Attorneys MARC P. BERGER and
JOAN M. LOUGHNANE are in charge of the prosecution.
09-188 ###

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