Boca Raton Businessman Found Guilty of $100 Mil Stock Fraud
via bfishadow on Flickr
The old tale is Wall Street sharks screwing over us, the little people. But sometimes the deep-pocketed cannibalize themselves. Case in point, Argyll Equities Inc., a San Diego-based outfit that had a unique way of screwing clients out of their money.
And according to federal prosecutors, the guy who teed up suckers for the scam was Boca Raton's own Jeffrey Spanier, head of local Amerifund Capital Finance. The irony here is that Spanier and his two cohorts didn't target just anyone but supposedly savvy business players.
From as far back as 2003, Spanier, manning the controls at Amerifund, funneled clients to Argyll, run by Douglas McClain Jr. and James Miceli. The setup was pretty simple: The three men offered loans to desperate executives. As collateral, they asked for stock from publicly traded companies, offering "margin loans at 50-70% loan-to-value based on the market price of their stock," according to this good rundown by Dealbreaker.com.
As collateral, the stock was never supposed to be sold unless the borrower defaulted on his payments. Instead, the Argyll crowd immediately sold the stock at market value, handing over 50 to 70 percent of the sale to finance the loan and pocketing the remainder.
The borrowers -- not knowing what was up -- were also making regular payments on the loan, thus lining Argyll's pockets further.
Again, these weren't Joe and Jane Sixpacks getting screwed but big corporate executives sitting on massive stock holdings. Victims included individuals from the U.S., Canada, Mexico, China, Hong Kong, and the Netherlands. All told, federal prosecutors say the scheme fetched around $100 million for Spanier, McClain, and Miceli.
In March 2012, the three were arrested and charged with a battery of counts, including conspiracy, mail fraud, wire fraud, and securities fraud. Miceli committed suicide before going to trial. Last May, McClain was convicted at trial in San Diego and handed a 15-year sentence.
And earlier last December, it was Spanier's turn. The Boca resident had a two-week trial in San Diego. It took the jury one and a half days to convict on all 19 counts.
Send your story tips to the author, Kyle Swenson.
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