MINEOLA, N.Y. – Nassau County District Attorney Madeline Singas announced that a former insurance broker pleaded guilty to scamming at least 50 people – many seniors – out of more than $12 million in a Ponzi scheme.
Kevin Brody, 55, of Stroudsburg, PA, pled guilty Friday before Judge Robert Schwartz to Grand Larceny in the Second Degree (a C felony) and Conspiracy in the Fourth Degree (an E felony). The defendant is expected to be sentenced to 2-1/3 years to seven years in prison on September 12. As part of the plea, the defendant also forfeited approximately $5 million that will be used towards restitution for the victims.
The case against his co-defendant Matthew Eckstein is still pending.
“This defendant lured hard-working men and women with a web of lies, duping them into paying thousands of dollars for the promise of a high return of investment,” DA Singas said. “Now, thanks to the dogged work of my prosecutors and investigators, $5 million will be returned to the victims of this reprehensible scheme.”
DA Singas said that beginning in January 2015, an elderly victim agreed to invest approximately $385,000 into Conmac Funding Corp., a Hicksville-based company owned by the defendants. The victim was told 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.
In January 2017, after waiting for two years, the victim requested the return of the money but received a payment of only $26,699. The victim continued to ask for the return of the remaining principal and interest but never heard back from the company again.
An investigation was started in November 2017 after the elderly victim reported the incident to the United States Securities and Exchange Commission, which referred the case to the NCDA. In total, the investigation uncovered at least 50 people that were victimized in a similar fashion by the defendants out of a total of $12 million.
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, the defendants are accused of using the money to fund other business enterprises including hamburger restaurants, personal purchases and paying other victims of the scheme.
As part of the scheme, victims were also provided 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.
Because the NCDA’s Asset Forfeiture Bureau froze all the defendants’ known assets including their bank accounts and real estate properties, much of the money will be returned to the victims.
The alleged victims are from Massapequa, Seaford, Smithtown, Melville, Staten Island, Brooklyn, Manhattan, Norwalk, CT, Jupiter, FL and Redlands, CA.
The NCDA thanks the U.S. Postal Inspection Service, Federal Bureau of Investigation, the United States Securities and Exchange Commission, the Financial Institution Regulatory Authority and the New York State Comptroller’s Office for their assistance on this case.
Senior Assistant District Attorney Betty Rodriguez of DA Singas’ Financial Crimes Bureau and Rebecca Winer, Chief of the Civil Forfeiture Bureau are prosecuting this case. James Drucker, Esq. represents Brody and Dennis Lemke, Esq. represents Eckstein.