Plea Secured In Windham Ski Patrol Swindle
Attorney General Spitzer today announced that a former stock broker who targeted members of the ski patrol at a Catskill mountain ski resort has pleaded guilty today in the Greene County Court to three felony counts stemming from a $5.4 million stock fraud scheme.
Pursuant to the negotiated plea, the defendant, Frank S. Marone, 41, of Fairfield, Connecticut, pleaded guilty to two counts of Grand Larceny in the First Degree, a class "B" felony, and Scheme to Defraud in the First Degree, a class "E" felony, before Judge George J. Pulver, Jr. Judge Pulver stated that it is his intention to sentence Marone to 6-18 years in state prison. Restitution was set at $4,669,458. Sentencing is scheduled for September 14, 2004.
Marone admitted during his plea that, from November 1998 through January 2004, while a part-time member of the Ski Patrol at Ski Windham, he engaged in a scheme to steal millions of dollars from his fellow patrol members through a series of fictitious equity funds he dubbed the "Patrollers Capital Funds."
"At its heart, this case is an old fashion stock swindle. The defendant used a clever scheme and a financial incentive to betray his friends and acquaintances," said Spitzer.
The defendant also admitted that an elaborate series of misrepresentations. To induce individuals to invest, Marone put on investment presentations and conducted meetings at Windham Mountain, and at investors' homes during which he told investors that the invested funds would be traded in high-tech and Fortune 500 companies. He also created fraudulent stock certificates, prepared phony account statements and authored e-mails trumpeting the performance of the fund. However, all of the investors' money was deposited directly into Marone's personal bank accounts.
Attorney General Spitzer thanked the United States Security and Exchange Commission and the Greene County District Attorney's Office for their assistance in the investigation.
This matter was prosecuted by Assistant Attorney General Richard Ernst of the Criminal Prosecutions Bureau under the supervision of Deputy Bureau Chief Viola Abbitt. Supervising Investigator David Adams and Investigator Mark Spencer of the Investigations Bureau assisted in the investigation.