Super Lawyers
The Netional Trial Lawyers - Top 40 Under 40
Avvo Clients Choice
Avvo Top Contributor
Avvo Rating
Published on:

Pennsylvania Man Charged for Allegedly Defrauding Family, Friends Out of $1 Million Using Worthless Stocks

markus-spiske-5gGcn2PRrtc-unsplash-300x200The U.S. Attorney’s Office for the Eastern District of Pennsylvania has announced charges against a Northampton County man accused of swindling over 50 victims out of more than a $1 million by selling them worthless stocks.

Robert McCabe, 76, of Bangor, PA, was charged with multiple counts of securities fraud, wire fraud, and mail fraud. Attorney information was not available.

According to a Department of Justice news release, the swindler from Northampton County is accused of stealing an estimated $1 million from more than 50 family members and friends between September 2010 and July 2020. He allegedly claimed that his company, McCabe Properties, had almost two million “founders’ shares” of an unnamed pharmaceutical company. He offered his victims a stake in those shares by selling them a similar number of shares of his company, the release claims.

Authorities said the defendant purportedly sold the investment to his victims at between $2.60 and $2.70 per share, which was significantly less than the actual share price of the pharmaceutical company. In reality, however, his company didn’t have any assets, so the shares the defendant sold to his investors were worthless, prosecutors allege.

He allegedly used various excuses to prevent his investors from selling the shares, including saying they could only be sold once the pharmaceutical company was acquired by another company. He also purportedly forwarded them financial reports, press releases, and news stories about the pharmaceutical company to make the enterprise seem more legitimate.

“As alleged, McCabe is a fraudster who promised something that he had no intention of delivering,” said U.S. Attorney McSwain. “Here, according to the Information, he exploited personal relationships with trusting members of his own family and circle of friends, repeatedly lying about the investment he sold to them. This type of financial fraud has devastating consequences for the victims and must be aggressively prosecuted and deterred at every turn.”

The defendant’s case was investigated by the Federal Bureau of Investigation (FBI) and is being prosecuted by Assistant U.S. Attorney Michael S. Lowe. It is not clear at this time what is being done to assist the victims of the scheme.

Fraud consists of an omission, concealment, perversion of truth, or deception made with the intent of causing financial damage to unwitting victims. Any deceitful business practice that results in financial harm is considered fraud.

Securities fraud, mail fraud, and wire fraud carry severe penalties because they are federal crimes. For example, if the defendant is convicted, he faces penalties that include a maximum prison sentence of 420 years, a $10 million fine, and a $2,100 special assessment.

The federal government has almost limitless resources to investigate and prosecute fraud cases, which is why anyone accused of committing fraud should immediately hire an attorney who can look out for their interests. A good defense attorney can investigate the charges and create a defense strategy that is unique to your case.

South Florida Fraud Defense Attorney

Are you accused of committing fraud in South Florida? Contact Brian Silber, P.A. to set up a free initial consultation with one of South Florida’s most experienced fraud defense attorneys.

Source: 9.30.20 Northampton county man charged with defrauding victims out of more than $1 million by selling worthless stock.pdf

Contact Information