A federal jury returned its verdict following a four-week trial that has found two Albany based investment brokers guilty of swindling millions of dollars from their clients. Timothy McGinn, 64, was found guilty of 27 counts of mail fraud and wire fraud, as well as filing false tax returns. David Smith, who is 67, was also found guilty of 15 counts of the same charge. The United States Attorney’s Office in Albany says the two could face up to 15 years in federal a prison when they are sentenced later this year on June 28th. The most serious of these charges could ensure that these investment brokers face a $1 million fine.
The indictment alleged that the defendants improperly used a corporation to conceal and disguise the true nature of the payroll diversions by passing the money from three unrelated investments through that corporation and then to the broker-dealer.
Mcginn and Smith were also both convicted on the tax charges that arose from their failure to declare the improperly diverted money on the personal tax returns from the years 2006-2009. The two later described this money as “loans”, but did not list them as such on personal financial statements. When the FINRA (Financial Industry Regulatory Authority, Inc) discovered the false loan accounting entries for the diverted money, the defendants mislead FINRA by directed the creation of backdated promissory notes.
The case was investigated by the Internal Revenue Service, Criminal Investigation, and the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorneys Elizabeth C Coombe, Richard D. Belliss, and Wayne Myers.
According to a statement from the United States Attorney’s Office, the two men are expected to appeal this verdict.
If you find yourself facing federal fraud charges, it is important to find an experienced wire fraud attorney to represent you. The white collar criminal attorneys of Parkman & White, LLC have a history of success in the court room and are ready to represent clients nationwide.