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Financial Crimes
03/11/2010

ICE fraud investigation returns millions to victims

Hundreds of victims to receive millions of dollars from fraud proceeds

PHILADELPHIA - After years of tracking and seizing assets such as foreign bank accounts, luxury cars, and real estate, all bought with money gained through fraud, special agents from U.S Immigration and Customs Enforcement (ICE) in Philadelphia seized over $7.7 million dollars that has been returned to 869 defrauded investors, 846 domestically and 23 abroad.

The ICE investigation focused on a group of two main players and eight co-conspirators. The group was led by Jean Pierre Collardeau and Charles Nisenbaum. The conspiracy involved the fraudulent issuance, promotion, and sale of millions of shares of stock of Pro Net Link (PNLK), an internet start-up company based in New York. On November 6, 2003, Collardeau, CEO of PNLK, and eight other individuals were indicted in the District of New Jersey on Securities Fraud, Money Laundering, and Conspiracy charges. The indictment also included a forfeiture allegation. Nisenbaum was charged in a separate indictment with securities fraud and currency violations.

The defendants conspired to create PNLK as a publicly traded company that issued millions of shares of stock in the names of nominees of defendants Collardeau and Nisenbaum. The conspirators concealed their beneficial ownership of the stock from the SEC and the investing public. They also disseminated false and misleading statements and made omissions of material facts about PNLK.

As a result, they fraudulently increased the stock price and trading volume of PNLK stock. Once the value of the stock was inflated and the demand was high, they sold the millions of shares of PNLK stock to the investing public through the nominee accounts they controlled, thereby generating illegal profits. The proceeds from the PNLK scheme were laundered unwittingly through accounts with Atlantic City casinos and other financial institutions including banks in the U.S., Canada, and Switzerland without their knowledge. The co-conspirators used significant amounts of the proceeds to purchase real property and other assets.

"Given the huge amount of money generated by this illegal enterprise it is fitting that ICE was able to recover so much for the victims of these crimes," said John P. Kelleghan, special agent in charge of the ICE Office of Investigations in Philadelphia. "This case demonstrates our commitment to holding those who exploit the trust of the investing public accountable for their actions."

ICE agents from Philadelphia and around the country identified, seized, and forfeited $7,739,778.43 in proceeds from Collardeau, Nisenbaum and their co-conspirators. The major penalties and forfeitures resulting from this prosecution:

  • Collardeau was sentenced to 50 months incarceration for Conspiracy to Commit Securities Fraud, Mail Fraud, and Wire Fraud on July 7, 2005, and ordered to surrender cash and real properties. The assets comprised of monies and proceeds from sale of real properties were approximately $3,590,117.00.
  • Nisenbaum was sentenced to 4 and half months incarceration for Conspiracy to Commit Securities Fraud, and Currency Reporting violations on May 28, 2008. A final order of forfeiture and default judgment was issued by the court against real property known as 992 Sanibel Drive, Hollywood, Fla. and the cash proceeds from the sale of another property in Florida. The proceeds from the sale of 992 Sanibel Drive and the cash were approximately $1,130,221.00.
  • On April 11, 2008, a final order of forfeiture against proceeds from the sale of real property, cash, five luxury cars, and assorted jewelry seized from another co-conspirator, Irving Freiberg. All forfeited assets were valued at approximately $2,278,777.00. Freiberg is awaiting sentencing.
  • On October 28, 2009, ICE agents seized $740,663.32 from UBS Bank Account in the name of Rofiru International after it was frozen by U.S. and Swiss authorities.

On February 2, 2010, the ICE National Finance Center (NFC) certified the payment of approximately $7,739,778.43 to 869 victims of a stock fraud scheme. The total loss for this group of victims was approximately $12,413,101.19. As a result, the victims will receive about 62% of the funds they lost in this fraud.

ICE's "Cornerstone" initiative is to detect and close down weaknesses within U.S. financial, trade and transportation sectors that can be exploited by criminal networks. Active partnership between law enforcement and the private sector is a key component of Cornerstone. We build partnerships by sharing law enforcement typologies and methods with businesses and industries that manage the very systems that terrorists and criminal organizations seek to exploit. This sharing of information allows the financial and trade community to take precautions in order to protect themselves from exploitation. In return, ICE receives information, "red flags", tips, and insight from these industries to more effectively investigate these complex and sophisticated criminal schemes.

Financial investigations are essential if we are to beat the criminals at their trade. Although they are often long and complex investigations, following the money trail allows law enforcement to identify and dismantle international criminal networks, and to seize their proceeds and related assets. ICE, along with its sister agencies under the Department of Homeland Security (DHS), is charged with protecting the nation's borders, which includes investigating the illicit flow of money in and out of the United States. Anyone can report suspicious activity by calling 1-866-DHS-2-ICE.