Stuart, Florida – Frank Anthony DeSantis III was sentenced to 108 months in prison and ordered to pay over $2 million in tax penalties after pleading guilty to conspiracy to commit mail and wire fraud, and conspiracy to defraud the Internal Revenue Service, according to court documents filed February 19, 2009.
DeSantis admitted to participating in a scheme to defraud customers of commodity investments through telemarketing rooms across South Florida. He and his associates allegedly misrepresented key facts to potential investors, enticing them to invest in foreign currency (forex) options. Crucially, DeSantis concealed from customers that over 95% of previous investors had lost their money, and failed to disclose a prior ban by the CFTC from acting as a commodities broker.
This criminal prosecution follows a 2006 civil complaint filed by the CFTC. On September 9, 2008, the CFTC secured a permanent injunction against DeSantis in the case of CFTC v. Doreen Valko, et al., resolving all CFTC charges. The civil suit alleged that DeSantis used customer funds for personal expenses, including luxury homes, boats, and cars.
Judge William P. Dimitrouleas previously ordered DeSantis to pay over $8 million in restitution and penalties for fraud and misappropriation related to his operation of International Investments Holdings Corporation (IIHC). The order also permanently prohibits DeSantis from participating in any business involving commodity futures and options trading.
The U.S. Commodity Futures Trading Commission commended the U.S. Attorney for the Southern District of Florida for their successful prosecution of DeSantis.
Source: CFTC.gov
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