Brokers In $3.2 Million Long Island Boiler Room Stock Scam Case Sentenced
Attorney General Spitzer today announced the sentencing of four members of a Long Island boiler room operation that defrauded 90 victims out of $3.2 million.
Suffolk County Supreme Court Judge Joseph Farneti sentenced Vikram Randhawa, the top salesman of Renaissance Capital Management, Inc. to a term of 2-6 years for the stock scam. Allen Andrescu, the President and owner of Renaissance, is due in court on October 20 and is expected to be sentenced to 3-9 years. In August 2000, Andrescu and Randhawa pled guilty to felony grand larceny in the second degree, and a felony count of scheme to defraud.
"These defendants thought they could swindle investors and break the law," Attorney General Spitzer said. "This case shows that we will vigorously prosecute those who violate the public trust for their own gain. "
Andrescu and Randhawa, admitted to the court that they operated an illegal boiler room operation, from October 1997 to June of 1999, out of 1111 Route 110, in Farmingdale where they and their associates sold worthless stock in a company called NNPD Textiles, Inc. The brokers used false representations and high-pressure sales tactics, which included harassing investors, in order to sell the stock in the worthless company.
The brokers promised investors a two and three time return on their money within 90 days and that NNPD Textiles was about to go public. In fact the stock was worthless and the company never went public. Andrescu and Randhawa stole investors' money to support their gambling habits and lavish life-style of expensive cars, jewelry, and vacations.
Three cold-callers who worked for Andrescu were also sentenced today, to conditional discharges for selling securities without a license, a misdemeanor.
The case was handled by Assistant Attorneys General John Panagopoulos of the Investor Protection Bureau and Zachary Weiss of the Criminal Prosecutions Bureau.