$60M Tribal Bond Scam: Galanis Admits Guilt

NEW YORK, NY – Jason Galanis has confessed to a brazen scheme that bilked a Native American tribe and unsuspecting investors out of over $60 million. The California man pled guilty today in Manhattan federal court to conspiracy to commit securities fraud, securities fraud, and conspiracy to commit investment adviser fraud before U.S. District Judge Ronnie Abrams. The case, spearheaded by former U.S. Attorney Preet Bharara, reveals a calculated betrayal of trust and a callous disregard for the financial well-being of both the Wakpamni Lake Community Corporation and the individuals whose savings were funneled into a worthless investment.

According to court documents, between March 2014 and April 2016, Galanis, along with co-conspirators Gary Hirst, John Galanis a/k/a “Yanni,” Hugh Dunkerley, Michelle Morton, Devon Archer, and Bevan Cooney, orchestrated a fraudulent plot. They pushed the Wakpamni Lake Community Corporation (WLCC) to issue bonds – the “Tribal Bonds” – then systematically siphoned off the proceeds for their own lavish lifestyles. These bonds were then aggressively sold to investors who were left holding assets they couldn’t sell, a classic pump-and-dump operation cloaked in the guise of legitimate investment.

The scam hinged on a lie. Documents stipulated that bond proceeds would be invested to generate annuity payments, funding both interest on the bonds *and* economic development for the WLCC. Instead, not a dime reached the intended investment manager. Instead, over $38 million landed in an account controlled by Dunkerley and Hirst, then a significant portion – over $8.5 million – flowed directly to JASON GALANIS. He then blew the money on personal expenses: a luxurious home, expensive jewelry and clothing, extravagant travel, and endless restaurant bills. This wasn’t investment; it was theft, plain and simple.

Adding insult to injury, Galanis and his crew used client funds from Hughes Capital Management, Inc. and Atlantic Asset Management, LLC to purchase the worthless Tribal Bonds, all *without* informing their clients. Morton and Hirst, acting on Galanis’s orders, ignored established investment parameters and disregarded glaring conflicts of interest. When clients inevitably discovered the purchases, they demanded a sale, but the bonds were deliberately designed to be illiquid, leaving them trapped with unusable assets. No bonds have been sold from any Hughes or Atlantic client accounts to this day.

“As Jason Galanis admitted today in his guilty plea, he and his co-conspirators cheated their tribal clients by urging them to issue bonds, and then siphoning off the proceeds for their own personal use,” stated U.S. Attorney Bharara. “The defendants then sold these bonds to unwitting investors, resulting in tens of millions of dollars in losses.” The full extent of the damage and the fate of the remaining co-conspirators remains to be seen, but Galanis’s guilty plea marks a crucial step towards accountability in this complex and devastating fraud.

The case is being prosecuted by the Office of the United States Attorney for the Southern District of New York. Sentencing for JASON GALANIS has not yet been scheduled. Grimy Times will continue to follow this case and report on any further developments, exposing the predators who prey on vulnerable communities and unsuspecting investors.