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22 Apr 2010

Fictional Trading Experts Charged in NY Hedge Fund Scam - The SEC has charged the self-proclaimed, “Wolves of Wall Street,” a Staten Island investment advisory firm, with operating an Internet-based scam that misleads investors into paying fees for phony stock tips and investment advice from fictional trading experts.

The team is charged with fraud, pretending to run a $1.4 billion hedge fund using fake names and claiming millions of dollars in trading riches as well as top-notch educational backgrounds and prominent experience at major Wall Street firms.

The “hedge fund”, called Gryphon, had fabricated glowing testimonials from George Soros and other big name traders on its website.

Gryphon frequently posted investment tips on the Internet, the SEC alleges, using at least 40 different monikers such as “Wolves of Wall Street,” “Wall Street’s Most Wanted,” “Pure Profit,” and “Mafia Trader.” In reality, Gryphon’s financial publications only served as a vehicle to attract unsuspecting investors.

According to the SEC’s complaint, Gryphon obtained more than $17.5 million from its operations over the past three years.

The Judge granted the SEC’s request for a temporary restraining order and asset freeze against the Defendants and six others named as Relief Defendants: (real names) Richard Borrello, Nicole Marsh, Ginna Mungiovi, Michael Scarpaci, Dominic Spinelli, and Paul Stokes.