Unted States v. Loffredi

Loffredi’s securities brokerage firm offered investments in certificates of deposit, mutual funds, and Treasury bills. Instead of actually purchasing investments requested by customers, Loffredi diverted their money to his personal expenses and business debts. He fraudulently misappropriated about $2.8 million over four years. A customer alerted the Securities and Exchange Commission to irregularities in his financial statements. After an investigation, Loffredi was charged with five counts of mail fraud, 18 U.S.C. 1341. He pleaded guilty to one count. The judge applied a two-level upward adjustment under U.S.S.G. 2B1.1(b)(2)(A)(i) for an offense involving at least 10 victims and imposed a sentence of 78 months. The presentence report counted as victims each of the 14 defrauded customers whose funds Loffredi had misappropriated. Loffredi argued that the only victim of the offense was his broker-dealer parent firm, which had reimbursed the losses of 12 of the 14 customers (Loffredi reimbursed the other two). The Seventh Circuit affirmed, noting that Loffredi never asserted that his fraud was painless for his customers and rejecting his “all-or-nothing” defense that the customers cannot be victims if they were reimbursed. View "Unted States v. Loffredi" on Justia Law