Manhattan, NY – Craig Zabala, the head of a purported financial services empire, found himself on the wrong side of the law today, slapped with federal charges of securities and wire fraud. Authorities allege Zabala, chairman, CEO, and president of Concorde Group Holdings Inc., swindled at least 18 investors out of approximately $4.4 million. The scheme, built on a foundation of lies and false promises, reportedly funneled investor money into Zabala’s pockets and used it to prop up a failing business through Ponzi-like payments.
Acting U.S. Attorney Audrey Strauss didn’t mince words, stating that Zabala “fraudulently induced” investors with fabricated claims about fundraising, fund usage, investor lists, and the company’s progress toward an initial public offering. The feds claim Zabala wasn’t investing as promised, instead siphoning off cash for personal expenses and using new investor funds to pay off earlier ones – a classic hallmark of a Ponzi scheme. Zabala was arrested this morning and is expected to appear in Manhattan federal court before U.S. Magistrate Judge Sarah Netburn.
The complaint unsealed today paints a picture of a tangled web of companies controlled by Zabala: Concorde Group Holdings Inc., Concorde Group, Inc., Blackhawk Capital Group BDC, Inc., DBL Holdings, LLC (operating under the name Drexel Burnham Lambert), Concorde Investment Managers, LLC, and Concorde Europe, Ltd. The alleged scheme stretched back to at least 2015, with Holdings maintaining an office in Jersey City, New Jersey, and a mailing address in New York City. The company falsely advertised providing financial services – merchant banking, investment banking, asset management, and securities brokerage – to small and mid-sized businesses.
Adding another layer to the mess, authorities revealed Zabala was barred by FINRA from the broker-dealer industry in August 2019, due to his lack of cooperation with an investigation. Despite this, he allegedly continued to operate his firms and solicit investors. Philip R. Bartlett, Inspector-in-Charge of the U.S. Postal Inspection Service’s New York Division, warned, “Greed has a way of overcoming honest business practices.” He characterized the case as a “classic Ponzi scheme” and cautioned investors to be wary of high-reward, high-risk investments.
Prosecutors allege Zabala was a majority owner of both Holdings and Concorde Group, Inc., further cementing his control over the fraudulent operation. The complaint details how Zabala’s companies purported to offer the same financial services, but ultimately served as vehicles for the alleged scam. The investigation is ongoing, and further details are expected to emerge as the case progresses through the federal court system. The U.S. Attorney’s Office has yet to announce potential sentencing guidelines should Zabala be convicted.
This case serves as a stark reminder of the dangers lurking in the world of high finance. While legitimate investment opportunities exist, predatory individuals like Zabala prey on unsuspecting investors, promising riches while lining their own pockets. The Grimy Times will continue to follow this case and report on any developments as they unfold, exposing the underbelly of financial crime and holding those responsible accountable.”
Related Federal Cases
- John Desantis, Securities and Wire Fraud, NY · New Jersey
- Vadym Iermolovych, International Securities Fraud, New Jersey 2024 · Pennsylvania
- Brian Robert Mailman Sodi, Securities and Mail Fraud Conspiracy, AL · New Jersey
- Celadon Group Inc, Securities Fraud, IN 2023 · Indiana
- Marc Henry Menard, Investment Fraud Scheme, Mineola NY, 2023 · Pennsylvania
Key Facts
- Agency: U.S. Secret Service
- Category: Fraud & Financial Crimes
- Source: Official Press Release
Get the grimiest stories delivered weekly. Subscribe free
Browse More
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News