Victims of Palladino Fraud Urged to Contact SEC

Victims of a West Roxbury couple's alleged Ponzi scheme are being urged to contact the U.S. Securities and Exchange Commission after a Massachusetts District Court recently found the two defendants liable for violations of the securities law. 

Steven Palladino and his wife, Lori, ran the Centre Street Viking Financial Group, and were arrested in March and April, for the alleged multimillion scam.

Individuals who invested with Viking or Palladino since April 2011 and believe they may have been a victim of this fraudulent scheme should contact Deena Bernstein at 617-573-8813 or bernsteind@sec.gov on or before Friday, August 2, 2013.

On April 30, SEC filed an emergency enforcement action against the defendants alleging that since April 2011, "Palladino and Viking falsely promised at least 33 investors their money would be used to conduct the business of Viking, which was to make to short-term, high interest loans to those unable to obtain traditional financing," according to an SEC press release. 

Palladino told investors loans made by Viking would be secured by first interest liens on non-primary residence properties and investors would be paid back their principal, plus monthly interest at rates generally ranging from 7-15%, from payments made by borrowers on the loans, according to the SEC.

Instead the Palladinos and Viking made very few real loans to borrowers, and instead used investors’ funds mostly to make payments to earlier investors and to pay for the family’s personal life, including thousands spent on gambling excursions, vacations, luxury vehicles and tuition.

The court also said the SEC "is entitled to injunctive relief and a temporary order of disgorgement of ill-gotten gains in the amount of at least $3.1 million." The court also held "that imposition of any civil penalties would be determined after a criminal case against the Defendants has been resolved." The order freezing the defendants’ assets remains in place.

The SEC also acknowledged the assistance of Suffolk County District Attorney Daniel Conley’s Office, which filed related criminal charges against Palladino and Viking in March 2013.