May 31, 2018 Comments (0) Blog, Current Investigations, Securities Fraud

SEC Charges NY Advisor Steven Pagartanis with $8 Million Fraud Scheme

Steven Pagartanis

Barred Long Island Broker Steven Pagartanis Faces Criminal Charges

Have you suffered investment losses with former advisor Steven Pagartanis? If so, the securities attorneys at the White Law Group may be able to help you to recover your losses by filing a FINRA Arbitration claims against his employer.

According to a press announcement, the Securities and Exchange Commission yesterday charged former financial advisor Steven Pagartanis with defrauding long-standing brokerage customers in an $8 million investment scam.

According to the SEC’s complaint, Steven Pagartanis, while registered with a broker-dealer, allegedly told some retired customers that he would invest their funds in either a publicly-traded or private land development company.

Pagartanis allegedly promised that the funds would provide guaranteed monthly interest payments on the investments, and that the investments would be safe.  According to the complaint, his investors wrote checks payable to a similarly-named entity that was allegedly controlled by Pagartanis, reportedly without them knowing.

In all, the customers invested approximately $8 million, which Pagartanis purportedly used to pay personal expenses and make the guaranteed “interest” payments to his customers. Further, Pagartanis allegedly created fictitious account statements reflecting ownership interests in the land development companies.

According to the complaint, the scheme was revealed when Pagartanis stopped making the so-called interest payments to customers.

The Suffolk County District Attorney’s Office reportedly filed criminal charges against Pagartanis.

According to his FINRA BrokerCheck report, Pagartanis was registered with Cadaret, Grant & Co. in East Setauket, NY from September 2012 until he was fired in March 2017. Then he reportedly spent 6 months working for Lombard Securities until he was discharged for failure to provide information “on unapproved investments allegedly made outside of the firm by a customer and why the broker failed to notify the firm regarding such outside investments.”

FINRA reportedly barred Pagartanis from the securities industry in April 2018 for failure to provide testimony “in connection with its investigation of allegations that he made fraudulent misrepresentation to customers and misappropriated customers’ funds.”

Failure to Supervise

The White Law Group continues to investigate the liability that Pagartanis’ employers may have for failing to properly supervising him.

Brokerage firms are required to properly supervise their advisors. They must ensure that those advisors are complying with applicable FINRA rules and regulations. If it can be demonstrated that his former employers failed to properly supervise Pagartanis, they may be held responsible for the losses in a FINRA arbitration claim.

If you are concerned about your investments with Steven Pagartanis and would like a free consultation to discuss your litigation options, please call The White Law Group at 1-888-637-5510.

The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.