Financial Advisor, Daughter Defrauded Investors Of $11M: USAG

A financial advisor in Rockland County was sentenced Wednesday to 13 years in prison for defrauding clients out of more than $11 million. On Thursday, his daughter was indicted for her part in the conspiracy, said Geoffrey S. Berman, the United States Attorney for the Southern District of New York.

Hector May was the president of Executive Compensation Planners, Inc. in New City. Vania May Bell, May’s daughter, was comptroller of ECP.

"For more than two decades, May conceived and orchestrated a multimillion-dollar Ponzi scheme," Berman said in the announcement. "His conduct was marked by extreme cunning, ruthlessness, and utter disregard for the well-being of his victims, including aging couples, close friends, relatives, and an employment pension plan."

At the sentencing hearing, Judge Vincent Briccetti said that his conduct was “appalling, reprehensible, and evil.”

According to the prosecutors, from the late 1990’s through March 9, 2018, May and Bell induced victims to forward them more than $11,400,000.

A financial advisor, MAY was a registered representative of a broker dealer (“Broker Dealer-1”). Broker Dealer-1 and associated clearing firms maintained securities accounts for ECP’s clients and, through those accounts, held ECP’s clients’ money, executed their securities trades, produced account statements reflecting activity in the clients’ accounts, and forwarded these account statements to ECP’s clients.

To get his hands on money from the victims’ securities accounts with Broker Dealer-1, May advised several clients that they should have ECP purchase bonds on their behalf rather than the broker dealer, claiming that way they could avoid transaction fees. He persuaded the victims to withdraw the money themselves and to forward it to an ECP “custodial” account.

After they sent their money to the ECP Custodial Account, May and Bell spent it on business expenses, personal expenses, and to make payments to certain victims in order to perpetuate the scheme and conceal the fraud.

In some cases, May used some clients’ funds to make purported bond interest payments to other victims. In other cases, he used clients’ funds to make payments to victims who wished to withdraw funds from their accounts.

The two also created and issued phony “consolidated” account statements, prosecutors alleged. These statements purported to reflect the victims’ total portfolio balances and included the names of bonds May pretended to purchase and the amounts of interest the victims were supposedly earning on them. In order to create the phony consolidated account statements, May provided Bell with bond names and false interest earnings, and prosecutors allege Bell created ECP computerized account statements and distributed them.

Bell processed the victims’ payments for the purported bonds, entered them in a computerized accounting program, and kept track of how they received and spent the stolen money, prosecutors said.

In addition to his prison term, May, 78, of Orangeburg, New York, was ordered to serve three years of supervised release, pay $8,041,233 in restitution, and forfeit $11,452,185.

BELL, 54, of Montvale, New Jersey, is charged with one count each of conspiracy to commit wire fraud and wire fraud. Each count carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense. The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.