A final court judgment has been obtained against the former owner of an anti-fraud company that orders him to pay nearly $1.5 million for cheating investors, the Securities and Exchange Commission announced today.
Lev Parnas, who was the subject of the most recent court order, and his co-defendant, David Correia, became famous when their political ties to former New York City Mayor Rudolph Giuliani were revealed, landing them in legal trouble on numerous fronts.
The most recent order of disgorgement represents the ill-gotten gains obtained by Parnas from investors in a now-defunct company that promised to help clients recoup money lost in fraudulent schemes, the SEC said.
The payment was ordered Tuesday by the U.S. District Court for the Southern District of New York as a final consent judgment that settles part of a case originally brought against the two Florida residents.
Parnas of Boca Raton and Correia of West Palm Beach were originally charged by the SEC and in criminal complaints for fraudulently raising more than $2 million by making false claims about their firm, Fraud Guarantee.
According to the SEC complaint, from 2013 through mid-2019, the two made false claims about the company, which never became operational. They told potential investors that their funds would be used to develop products that would help customers recoup losses resulting from investment or consumer fraud.
The money they raised was used to fund a lavish lifestyle that included travel, casino visits, jewelry and cars, the SEC said. Parnas and Correia also falsely told potential investors that they had raised millions of dollars from other investors and that they had invested hundreds of thousands of dollars of their own money in Fraud Guarantee, the complaint said.
The final judgment orders disgorgement of $1,400,746, representing Parnas' ill-gotten gains, and prejudgment interest of $378,844. Other parts of the charges remain to be settled.
The SEC declined to comment on the political ties of the defendants.