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Accused West Roxbury Ponzi Schemers Plead Guilty

The West Roxbury family members face jail sentences ranging from a suspended sentence to 12 years.

Stephen, Lori and Gregory Palladino. Source: Suffolk County District Attorney's office.
Stephen, Lori and Gregory Palladino. Source: Suffolk County District Attorney's office.
Stephen, Lori and Gregory Palladino all pleaded guilty to running a Ponzi Scheme through their financial  company. The family took $10 million from investors and used the money to fund their lifestyle, according to prosecutors in the case.

There were a number of charges levied against the different family members, including several larceny, false check, conspiracy and evidence tampering charges, according to a statement by the Suffolk County District Attorney Dan Conley's office.

"Well over $10 million dollars were lost to this scam, but how do you put a price tag on your parents' retirement account or your children's college fund?  The true cost is incalculable,"  Conley said. “This massive loss is bad enough, but it’s made even worse by what the investments were spent on: gambling debts, luxury vacations, top-of-the line cars, five-star restaurants, and Steven Palladino’s mistresses.  There was no legitimate business: it was an out-and-out scam perpetrated by Steven Palladino and abetted by his wife and son.”

Stephen, 56, was sentences to 10-12 years in jail and five years of probation for his role in the scheme. Wife Lori was sentenced to two years in a house of correction, which was suspended for five years, and son Gregory was sentenced to two years in a house of correction and five years of probation. All family members were ordered to pay restitution to the victims of the scheme. 

Prosecutors allege the Palladino bilked an initial round of investors out of $10 million. The victims were told the money would be used to make loans, which would bring back returns through high interest rates. The family, however, funneled that money into personal accounts. 

The family was also accused of cooking the books at the company, booking fake loans to cover their tracks. Of the few loans that were made, many came with interest rates of over 20 percent, leading to usury charges.

With the initial money in their pockets, the family then found new investors and took their money to pay back the initial investors, which is a hallmark of a Ponzi scheme. 
Gary Chase January 22, 2014 at 09:11 AM
Good. I bet they'll never get a dime back from them, but I hope that the government garnishes any wages they ever earn to help the poor souls they bilked.

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