Case Conclusion Date: 10.13.2015
Practice Area: Securities and investment fraud
Outcome: $1.86 million verdict
Description: After four years of litigation, two non-profit organizations, VASA Order of America, Inc. and VASA Order of American National Archives, Inc., along with a named individual, Rolf Bergman, obtained a $1.86 million verdict. Their counsel was Joel Levin and Apu Paul of Levin & Associates. The case revolved around the sale of unregistered securities in Ohio. Specifically, the Defendant, Rosenthal Collins Group, was found liable under R.C. 1707.43(A), for “participating in or [aiding] the seller in any way in making such [unlawful] sale” of securities with convicted Ponzi schemer, Enrique F. Villalba, Jr. In 1996, the self-described investment advisor, Villalba, promoted his proprietary "Money Market Plus Method" as a conservative, low-risk investment strategy to invest in securities. By predicting upward or downward momentum in the equity market, this "Money Market Plus Method" was designed to capitalize on certain market "spikes" which was identified by Villalba's "momentum filters." He claimed his investment strategy would preserve his clients' principal capital while earning returns of 8%-12%. Operating his business in Beachwood, Ohio, Villalba hatched a scheme to pool and comingle funds bilked from his clients and invest according to his "Money Market Plus Method"; however, he lacked the panoply of institutional facilities, operations and resources to manage and prosecute his scheme. He needed help. Enter Rosenthal Collins Group. In June, 1998, Villalba opened the Money Market Alternative, L.P. ("MMA") account at RCG. RCG provided the necessary, wherewithal for Villalba to perpetrate his unlawful securities investment scheme. During the course of Rosenthal Collins Group continued servicing and support of MMA, it became apparent that Villalba was engaged in a fraudulent enterprise. Specifically, Villalba would deposit and then within days rapidly withdraw those same funds from his account at Rosenthal Collins. To the demise of the victims, no one at Rosenthal Collins raised an eyebrow as the firm netted commissions nearing $1 million. As a result of his ongoing fraud, Villalba was charged and sentenced to more than eight years in prison by the Hon. James Gwin.