4

Broward Investment Manager Allegedly Sold $11 Million Worth of Imaginary Technology Stock

^
Keep New Times Free
I Support
  • Local
  • Community
  • Journalism
  • logo

Support the independent voice of South Florida and help keep the future of New Times free.

As they say in South Florida: another day, another alleged multimillion-dollar scam.

John Mattera, 50, was arrested at his Fort Lauderdale home yesterday, charged with securities fraud, wire fraud, conspiracy to commit securities fraud and wire fraud, and money laundering. Additionally, the Securities and Exchange Commission issued an emergency court order to freeze all of his assets.

According to the Manhattan U.S. Attorney's Office, Mattera banked $11 million by defrauding people through a scheme to have them invest in his pre-IPO shares of technology companies like Facebook and Groupon -- which he never had access to and probably never could have.

He then ended up blowing "millions of dollars of investor funds" on whatever he felt like, according to the feds.

"As alleged, John Mattera duped investors into believing they had bought rights to shares of coveted stock in Facebook and other highly visible and attractive companies which had not yet gone public," says Manhattan U.S. Attorney Preet Bharara. "As the complaint describes, Mattera told elaborate lies about stock he did not own and about how he would keep investors' money safe in escrow accounts. Instead, Mattera took the investors' money to fund his own extravagant lifestyle."

Mattera is accused of doing this while he was chairman of the advisory board for a professional mutual fund -- Praetorian Global Fund Ltd. -- between 2010 and 2011.

He'd then induce people to invest in these stock shares that he never owned that were certainly attractive, since the general thought was that the value of the shares would increase after the initial public offering.

That's how $11 million of investor money made its way into "escrow accounts" -- which weren't really escrow accounts, as the feds say Mattera spent $4 million of that money on himself for stuff like jewelry, interior decorating, and luxury cars.

Of the five charges Mattera faces, three carry maximum prison sentences of 20 years apiece, and the other two have maximum prison sentences of five years. He also faces millions of dollars' worth of fines.

According to the SEC, Mattera "has been a subject of a prior SEC enforcement action and several state criminal actions."

The SEC also mentions more of the companies Mattera claimed to have pre-IPO access to, including Twitter, Zynga, Bloom Energy, Fisker, Ren Ren, and "many more."


Follow The Pulp on Facebook and on Twitter: @ThePulpBPB. Follow Matthew Hendley on Facebook and on Twitter: @MatthewHendley.


Keep New Times Broward-Palm Beach Free... Since we started New Times Broward-Palm Beach, it has been defined as the free, independent voice of South Florida, and we would like to keep it that way. Offering our readers free access to incisive coverage of local news, food and culture. Producing stories on everything from political scandals to the hottest new bands, with gutsy reporting, stylish writing, and staffers who've won everything from the Society of Professional Journalists' Sigma Delta Chi feature-writing award to the Casey Medal for Meritorious Journalism. But with local journalism's existence under siege and advertising revenue setbacks having a larger impact, it is important now more than ever for us to rally support behind funding our local journalism. You can help by participating in our "I Support" membership program, allowing us to keep covering South Florida with no paywalls.

We use cookies to collect and analyze information on site performance and usage, and to enhance and customize content and advertisements. By clicking 'X' or continuing to use the site, you agree to allow cookies to be placed. To find out more, visit our cookies policy and our privacy policy.

 

Join the New Times community and help support independent local journalism in South Florida.

 

Join the New Times community and help support independent local journalism in South Florida.