WICHITA, Kan. A former Bergen County, N.J. man arrested in Park City Wednesday, faces charges of running a $900,000 foreign currency Ponzi scheme.
The U.S. Attorney's Office says Thomas Lanzana, 51, is accused of defrauding at least 20 people by soliciting investments in what he claimed were "highly successful financial instruments,", but turned out to be a Ponzi scheme," U.S. Attorney Craig Carpenito says.
The criminal complaint says as early as 2013, Lanzana -- formerly of Midland Park, N.J. and currently of Pawleys Island, S.C., -- "fraudulently solicited about $900,000 from at least 20 customers to invest in algorithm-based trading pools in foreign currency derivatives (forex) and other financial instruments."
Charges against Lanzana include one count each of wire fraud and commodities fraud.
"He falsely claimed to prospective customers that he was a successful forex trader," Carpenito says. "Lanzana allegedly took several steps to keep his costumers' trust."
Carpenito says these steps included sending false account statements to customers, posting false monthly account statements to his companies' websites showing balances -- some in excess of $800,000 for forex trading accounts that did not exist and sending false tax documents to customers reporting earnings that did not exist."
"Lanzana misappropriated at least $350,000 in customer funds, using some to repay earlier investors in the manner of a Ponzi scheme, and to pay for his personal expenses, including purchases on Amazon, payments to a luxury car dealer and a jewelry retailer, and golf expenses," Carpenito says.
The U.S. Attorney says a count of mail fraud against Lanzana carries a maximum penalty of 20 years in prison and a find of $250,000 or twice the gross gain or loss caused by the scheme. Carpenito says the count of commodities fraud carries a max penalty of 10 years in prison and a fine of $1 million, or twice the gross gain or loss.
Lanzana's initial federal court appearance was scheduled for Wednesday in Wichita. The U.S. Attorney did not explain what Lanzana was doing in the Wichita area at the time of his arrest.
Last year, the U.S. Commodity Futures Trading Commission (CETC) filed a civil enforcement action against two defendants, one of which was Lanzana and his company, Blackbox Pulse, LLC, charging them with fraaud.