Politics & Government

Glen Rock Man Charged in Alleged Ponzi Scheme

39-year-old George Sepero is accused of defrauding clients out of $3.5 million, funds U.S. attorneys say were used to support a lavish lifestyle

A Glen Rock man was arrested Wednesday by FBI agents for his alleged role in a Ponzi scheme in which he's purported to have defrauded victims out of more than $3.5 million, money authorities say he used to fund a lavish lifestyle.

George Sepero, 39, of Glen Rock, and Carmelo Provenzano, 29, of Garfield, were arrested Wednesday by FBI agents and are facing charges of wire fraud conspiracy. Authorities said the Ponzi scheme utilized a series of fake hedge funds, and lasted between 2009 until July of 2011, emptying a total of more than $3.5 million from investor pockets.

According to the complaint filed in federal court in Newark, Sepero and Provenzano are alleged to have used bogus screen shots to deceive investors that a computer algorithm they developed could yield returns of 170 percent despite a market downturn. One investor lost $2.1 million, U.S. Attorney Paul Fishman said in a release. The charges could land the two in jail for two decades, federal authorities say.

Find out what's happening in Ridgewood-Glen Rockwith free, real-time updates from Patch.

“With other people’s cash in their pockets, the defendants allegedly went on a spending spree involving luxury vehicles, international travel and extraordinary bar bills," Fishman said. According to the government, those luxuries from investor money include:

  • An average of about $25,000 a month in credit card bills
  • Bar tabs of approximately $18,241 – including a $4,000 tip; approximately $14,034 on separate nights at “Drai’s Hollywood” nightclub in Los Angeles
  • Luxury suite hotel rooms totaling tens of thousands of dollars; air flights to Paris, Los Angeles, Chicago, and elsewhere.  
  • A customized Ford F-350 "Harley Davidson Edition worth $80,000 for Sepero
  • A Range Rover worth over $71,000 for Provenzano
  • Personal expenditures including mortgage payments, home improvements, jewelry and others 

“Nobody asks to be defrauded, but those looking to invest should always be skeptical of rates of return that go so far beyond the norm,” Fishman said in the news release.

Find out what's happening in Ridgewood-Glen Rockwith free, real-time updates from Patch.

The defendants allegedly furthered the scheme by emailing victims fake statements showing their money had been invested in the foreign currency markets and was achieving substantial results, which the government said was compouded by fake e-mails sent under a fictional character, a one "Mel Tannenbaum".

Federal authorities also filed to forfeit Sepero's Glen Rock house on Hazlehurst Ave. as well as various vehicles federal officials contend the pair obtained with investors' money.


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