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Posted on: October 29, 2019

NCDA Returns $4.6 Million to Ponzi Scheme Victims Following Prosecutions

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MINEOLA, N.Y. – Nassau County District Attorney Madeline Singas announced that 48 Ponzi scheme victims received $4.6 Million in restitution payouts today following two NCDA prosecutions.

In September 2018, DA Singas announced the arrests of Kevin Brody a businessman from Pennsylvania, and his collaborator Matthew Eckstein, a financial advisor from Syosset, for scamming 50 people – many seniors – out of more than $12 million in a Ponzi scheme.

During the pendency of Matthew Eckstein and Kevin Brody's cases, the NCDA’s Asset Forfeiture Bureau froze all their known assets, including bank accounts and real estate properties, which allowed the NCDA to distribute $4.6 Million in restitution for the victims. The District Attorney’s Office is still working on collecting additional funds for restitution for those victims.

Today, each victim received a pro-rata share of the money that was recovered, based on their net loss, ranging from payments of $10,000 to $300,000.

“These thieves took advantage of the trust investors placed in them and scammed their victims—in many cases vulnerable seniors—out of at least $12 million in a massive Ponzi scheme,” DA Singas said. “I’m grateful to our prosecutors and our partners for holding them accountable and for their diligent work seeking restitution for the victims. 

“Fueled by greed, these bad actors tried to make a quick buck off the backs of working people,” said Attorney General Letitia James. “When New Yorkers invest their hard-earned savings, they should be able to do it without shady actors taking advantage of them. Whether you’re a local lender or a big Wall Street bank, everyone must play by the rules and I thank District Attorney Singas for holding these bad actors accountable.”

“Mr. Eckstein and Mr. Brody took advantage of people who trusted them with their hard-earned dollars while they funded their own business enterprises and extravagant lifestyles,” said State Comptroller Thomas P. DiNapoli. “I commend the work of District Attorney Singas, the Federal Bureau of Investigation and the United States Postal Inspection Service for their continued partnership and diligence in exposing this fraud.”

“The defendants’ actions in this case are shameful. They devised a scheme to mislead investors, many of whom were elderly. In many cases when money is lost, victims receive nothing. But today, due to great work of law enforcement, these victims can rest easier that some of their funds are being returned. This however, should be a cautionary story to investors that no matter your socio-economic status the return of funds does not happen every day. All investment offers, no matter who they come from, must be thoroughly vetted before investing,” said Inspector in Charge Philip R. Bartlett.

“At the time I invested my retirement savings with Matthew Eckstein, I’d known him for more than 30 years and trusted him with my money,” victim Laura Albergo said. “I am appalled and outraged that he used my hard-earned money to fund his lifestyle. While this is still a huge loss, I am very grateful for the efforts by the District Attorney’s office to be able to get some restitution for my family and me.”

Matthew Eckstein, 49, of Syosset pled guilty before Judge Robert Schwartz on September 26 to Grand Larceny in the First Degree (a B felony) and Conspiracy in the Fourth Degree (an E felony). He is expected to be sentenced on December 13 to 3-1/3 to 10 years in prison.

Kevin Brody, 55, of Pennsylvania was sentenced to 2-1/3 to seven years in prison before Judge Robert Schwartz on September 12, after pleading guilty to Grand Larceny in the Second Degree (a C felony) and Conspiracy in the Fourth Degree (an E felony).

DA Singas said that beginning in January 2015, an elderly victim for whom Eckstein worked as a personal accountant and financial advisor, agreed to invest approximately $385,000 into a Hicksville-based company owned by Brody, Conmac Funding Corp., at Eckstein’s urging. At that time, Eckstein, who was a registered CPA, assured his client that the investment was safe, had no risk, and the principal would be returned after a two-year waiting period with additional four-percent interest, like a certificate of deposit.

After waiting for two years, the victim requested the return of the money in January 2017 but received a payment of only $26,699. At that time, Eckstein then claimed that Conmac Funding was an insurance company, and her money had to be paid back in installments. The victim continued to ask for the return of the remaining principal and interest, but Eckstein stopped communicating with her.

An NCDA investigation was started in November 2017 after the elderly victim reported the incident to officials. A search warrant executed by NCDA investigators, the U.S. Postal Inspection Service, Federal Bureau of Investigation, and the New York State Comptroller’s Office in April 2018 at Eckstein’s home office yielded thousands of pages of financial documents.

At the time of Eckstein’s original arrest in June 2018, the NCDA was aware of at least 14 people victimized by Eckstein. Since then, at least 34 more victims were found to have been scammed by the defendants out of a total of $12 million. Many of the victims are senior citizens who trusted the defendants with their retirement savings. The victims who came forward allowed the NCDA to upgrade Eckstein’s charges and arrest Brody in connection with the scheme.

Some of the victims thought they were investing in something like a certificate of deposit with a guaranteed interest rate, others were told that the money would be used to finance premium insurance loans.

Instead of investing the money into Conmac Funding, the defendants used the money to fund other business enterprises – including hamburger restaurants – personal purchases and paying other victims of the scheme.

Additionally, Eckstein used some of the stolen funds for the down payment on his home, which has a swimming pool and tennis court. Eckstein’s house is currently in foreclosure and NCDA has a lien for any surplus proceeds from a foreclosure sale.

Eckstein and Brody also provided the victims with a username and password for www.conmacfunding.com to view their account statement and growing account balance, leading victims to believe that their principal investment was with Conmac Funding and earning interest.

The victims are from Massapequa, Seaford, Glen Cove, Oyster Bay, Plainview, Woodmere, Wantagh, Hewlett Harbor, Woodbury, Hicksville, Merrick, Oceanside, Smithtown, Melville, Dix Hills, Farmingdale, Miller Place, Staten Island, Brooklyn, Manhattan, Queens, Westchester, Norwalk, CT, Jupiter, FL and Redlands, CA, South Carolina, North Carolina, Pennsylvania, New Jersey.

Many of the victims were lured into the scheme by Eckstein who owned another firm called Sisk Investment Services that he ran out of his Syosset home. He convinced his existing clients, who trusted him, to invest in Conmac Funding.

The NCDA thanks the New York State Attorney General’s Office, the State Comptroller’s Office, the FBI, The United States Postal Inspection Service, the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority for their assistance on this case.

Previous NCDA releases:

June 2019: Pennsylvania Man Pleads Guilty to Grand Larceny and Conspiracy for role in $12 Million Ponzi Scheme

September 2018: $10 Million Ponzi Scheme Unraveled Following NCDA Investigation

Senior Investigative Counsel Betty Rodriguez of DA Singas’ Financial Crimes Bureau is prosecuting this case. Bureau Chief Rebecca Winer of DA Singas’ Civil Forfeiture Bureau handled the asset forfeiture. Dennis Lemke, Esq. represents Eckstein and James Drucker, Esq. represents Brody.

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