Financial Fraud: Antonio Buzaneli Sentenced Sentenced In Investment Fraud Scheme Involving Brazilian Factoring

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Florida Executive Sentenced To 20 Years In Prison For Orchestrating $150 Million International Ponzi Scheme

<h2>Florida Executive Sentenced To 20 Years In Prison For Orchestrating &dollar;150 Million International Ponzi Scheme<&sol;h2>&NewLine;<p>United States Attorney Erica H&period; MacDonald today announced the sentencing of ANTONIO CARLOS DE GODOY BUZANELI&comma; 57&comma; to 240 months in prison for his role in a &dollar;150 million investment fraud scheme involving Brazilian factoring&period; BUZANELI&comma; who entered his guilty plea on April 19&comma; 2018&comma; was sentenced today before Senior Judge Michael J&period; Davis in U&period;S&period; District Court in Minneapolis&comma; Minnesota&period; BUZANELI’S co-conspirators&comma; JOSE MANUEL ORDOÑEZ&comma; JR&period;&comma; 48&comma; was sentenced on January 23&comma; 2019&comma; to 120 months in prison and JULIO ENRIQUE RIVERA&comma; 62&comma; will be sentenced on April 16&comma; 2019&period;<&sol;p>&NewLine;<p>U&period;S&period; Attorney Erica MacDonald said&comma; &OpenCurlyDoubleQuote;Antonio Buzaneli was the primary architect of a &dollar;150 million Ponzi scheme that targeted hundreds of victims worldwide&comma; many of whom were elderly and vulnerable&period; Some victims lost their retirement savings&comma; others lost the ability to provide a college education to their children or grandchildren&period; For these egregious crimes&comma; Mr&period; Buzaneli will spend the next 20 years behind bars&period; I applaud our law enforcement partners for their steadfast efforts in seeking justice for the victims&period;”<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;No matter how complex the scheme&comma; the FBI is committed to stopping fraudsters like these from preying on people&comma; especially elderly investors who may have lost their life savings in this case&comma;” said Jill Sanborn&comma; Special Agent in Charge of the FBI&&num;8217&semi;s Minneapolis Division&period; &OpenCurlyDoubleQuote;We are grateful for our partners at the U&period;S&period; Attorney’s Office&comma; the United States Postal Inspection Service and the Minnesota Commerce Fraud Bureau for thoroughly investigating this global scheme and bringing these criminals to justice&semi; and we believe this matter further illuminates the need for citizens to be wary of those peddling these kinds of fraudulent business investments&period;”<&sol;p>&NewLine;<p>&OpenCurlyDoubleQuote;Our securities enforcement unit and the Commerce Fraud Bureau began investigating this scheme after receiving a tip about a suspicious investment opportunity being offered in Minnesota&comma;” said Steve Kelley&comma; Commissioner of the Minnesota Department of Commerce&period; &OpenCurlyDoubleQuote;We are proud that the Commerce Fraud Bureau collaborated successfully with federal authorities&comma; bringing to justice a far-reaching operation that deceived Minnesotans&period;”<&sol;p>&NewLine;<p>According to his guilty plea&comma; BUZANELI&comma; along with his co-conspirators&comma; ORDOÑEZ and RIVERA&comma; were the principals of Providence Holdings International&comma; Inc&period;&comma; a company based in Key Biscayne&comma; Florida&period; BUZANELI and ORDOÑEZ became principals of Providence <a class&equals;"wpil&lowbar;keyword&lowbar;link" href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;tag&sol;financial-fraud&sol;" title&equals;"Financial" data-wpil-keyword-link&equals;"linked" data-wpil-monitor-id&equals;"928">Financial<&sol;a> Investments&comma; Inc&period; and Providence Fixed Income Fund LLC &lpar;collectively&comma; along with Providence Holdings International&comma; Inc&period;&comma; &OpenCurlyDoubleQuote;Providence”&rpar; in order to raise money from investors&period;<&sol;p>&NewLine;<p>According to BUZANELI’s guilty plea and documents filed in court&comma; from about 2010 until June 2016&comma; Providence raised approximately &dollar;150 million from investors worldwide by representing that Providence would invest the money in Brazilian factoring&period; &OpenCurlyDoubleQuote;Factoring” is a financial transaction in which accounts receivable are purchased at a discount&period; Providence’s marketing materials explained that in Brazil consumers write ten separate post-dated checks for &dollar;100 – one per month – to pay for &dollar;1&comma;000 in retail items such as consumer electronics or groceries&period; The retailer then sells the post-dated checks to Providence for approximately &dollar;820&comma; and Providence earns &dollar;180 over ten months as the checks mature&period; As a result&comma; Providence claimed to make a 48 percent annual return on money invested in Brazil&period;<&sol;p>&NewLine;<p>According to BUZANELI’s guilty plea and documents filed in court&comma; Providence raised more than &dollar;64 million from U&period;S&period; investors by employing a network of brokers who sold promissory notes bearing annual interest rates between 12 percent and 24 percent&period; Investors were told their money would be used to factor accounts receivable in Brazil&period; BUZANELI&comma; ORDOÑEZ and RIVERA provided the brokers with an Executive Memorandum to show investors that their money would be used to factor accounts receivable in Brazil&period; The Executive Memorandum falsely stated that funds would be used &OpenCurlyDoubleQuote;for the sole purpose” of making loans to a Brazilian subsidiary of Providence &OpenCurlyDoubleQuote;which will use the proceeds of the <a class&equals;"wpil&lowbar;keyword&lowbar;link" href&equals;"https&colon;&sol;&sol;www&period;fraudswatch&period;com&sol;category&sol;loans&sol;" title&equals;"loan" data-wpil-keyword-link&equals;"linked" data-wpil-monitor-id&equals;"308">loan<&sol;a> to acquire receivables or financial instruments such a post-dated checks and&sol;or Duplicatas in the Brazilian Factoring Market&period;”<&sol;p>&NewLine;<p>According to the defendant’s guilty plea and documents filed in court&comma; BUZANELI and ORDOÑEZ instead used a significant amount of the investors’ funds to make Ponzi-style payments to other investors and to make commission payments to Providence’s nationwide network of brokers&period; BUZANELI and ORDOÑEZ also diverted investor funds to other companies they controlled&comma; including an import&sol;export company&comma; a travel company&comma; a realty company&comma; a credit rehabilitation company&comma; and a catering company and food truck operated by BUZANELI’S wife&period;<&sol;p>&NewLine;<p>According to the defendant’s guilty plea and documents filed in court&comma; BUZANELI and ORDOÑEZ also opened Providence offices and affiliates in locations around the world&comma; including London&comma; Taipei&comma; Shanghai&comma; Singapore&comma; Vancouver&comma; and Panama&period; For example&comma; in 2011 and 2012&comma; BUZANELI and ORDOÑEZ opened Providence affiliates in the Bailiwick of Guernsey and in Hong Kong&comma; through which they raised approximately &dollar;85 million from offshore investors based on the same lies they told investors in the United States – that their money would be used to invest in Brazilian factoring&period; Instead&comma; much of the investors’ money was transferred to other Providence-controlled entities around the world as well as to bank accounts controlled by BUZANELI and ORDOÑEZ&comma; where the money was used for payments unrelated to Brazilian factoring&comma; including to pay commissions to U&period;S&period; brokers and to make interest payments to American investors in Providence’s U&period;S&period;-based entities&period; As a result of the fraud scheme&comma; Providence investors worldwide – including more than 500 victims in the United States alone – lost a total of more than &dollar;100 million&period;<&sol;p>&NewLine;<p>This case was the result of an investigation conducted by the FBI&comma; United States Postal Inspection Service&comma; and the Minnesota Commerce Fraud Bureau&period; United States Attorney MacDonald would also like to thank the Securities and Exchange Commission for their assistance on this case&period;<&sol;p>&NewLine;<p>Assistant U&period;S&period; Attorneys Kimberly A&period; Svendsen and Joseph H&period; Thompson prosecuted this case&period;<&sol;p>&NewLine;<p>Defendant Information&colon;<&sol;p>&NewLine;<p>ANTONIO CARLOS DE GODOY BUZANELI&comma; 57<&sol;p>&NewLine;<p>Coral Gables&comma; Fla&period;<&sol;p>&NewLine;<p>Convicted&colon;<&sol;p>&NewLine;<p>Conspiracy to commit mail fraud&comma; 1 count<br &sol;>&NewLine;Sentenced&colon;<&sol;p>&NewLine;<p>240 months in prison<br &sol;>&NewLine;&dollar;51&comma;353&comma;861&period;45 in restitution<br &sol;>&NewLine;Three years of supervised release<&sol;p>&NewLine;

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