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Manhattan District Attorney Robert M. Morgenthau announced that four men have been sentenced today to lengthy terms in state prison for stealing $3.3 million in a pyramid scheme from about 130 New York investors.
IVORY T. FIELDS, JR. was sentenced to 5 to 15 years in prison; LESGAR GRANT was sentenced to 4 to 12 years in prison; and CHRISTIAN POLANCO and TERRANCE BLACKETT were each sentenced to 3 to 9 years in prison. All four defendants previously pleaded guilty on April 19, 2005, to Grand Larceny in the First Degree, a class B felony.
The defendants admitted that, from approximately May 2000 until November 2004, they were part of the management team of an unregistered company called ITF Enterprises, Inc. (“ITF”). FIELDS was ITF’s founder, sole proprietor, president, and namesake. GRANT, POLANCO, and BLACKETT all represented themselves to be ITF’s vice presidents.
In order to attract investors, the defendants represented that they operated a profitable corporation which traded stocks, commodities, indices and futures. FIELDS, GRANT, POLANCO, and BLACKETT made various misrepresentations to investors including that ITF was a registered corporation with experienced traders in stocks and commodities and that the company assumed all of the trading risk so that the victims’ principal investment was guaranteed. Investors signed contracts in which ITF promised substantial returns on their investments, ranging from 3.1% to 20% per month, and gave the victims the opportunity to further earn commissions by bringing more investors to ITF, as part of a chain-distribution scheme (i.e. “pyramid scheme”).
The defendants targeted family members, friends and co-workers, primarily in the African-American and Caribbean communities in Brooklyn and Dominican communities in Manhattan. Individual investors gave between $2,000 to $250,000 to ITF. Some victims invested and lost their life savings. One 49-year-old Queens woman invested approximately $165,000 after taking out a second mortgage on her home. A 39-year-old Manhattan cabdriver invested $50,000. A 75-year-old Queens retiree, who lived on a fixed-income, invested $10,000.
Only about $200,000 (out of the $3.3 million collected) was legitimately invested in high-risk commodity futures, such as cocoa, gold, corn, wheat, cotton, soybeans, lumber, sugar, and coffee, and all of it was subsequently lost. In pleading guilty, the defendants admitted to stealing more than $1 million and using that money for personal items and cash withdrawals not related to the company. The stolen money was siphoned from the enterprise, either through ATM withdrawals in New York and the Dominican Republic or numerous personal expenditures such as rent, restaurants, hotels, groceries, liquor, bars, airline tickets, furniture, and DVD rentals. A review of bank records revealed that the defendants used an ITF debit card for purchases at Circuit City, Home Depot, Kenneth Cole, Banana Republic, Hugo Boss, Louis Vuitton, Best Buy, and Lot 61, including $11,647 for merchandise purchased during 15 visits to Eredi Pisano, an Italian clothing shop. They spent approximately $2,500 on appliances at P.C. Richards, about $400 at Prada, about $600 on eyeglasses at Cohen’s Fashion Opticals, about $500 for DIRECTV in their homes, approximately $200 at the NBA Store in Manhattan, and $955 in one night at Sliver (a downtown Manhattan bar).
Of the $3.3 million the defendants raised from investors, at least $1.5 million was returned to investors in the form of either interest payments, commissions, or repayment of principal investments to perpetuate the scheme.
As part of their plea, all four defendants had agreed to pay $1.8 million in restitution to reimburse the victims prior to sentencing and were given seven months to raise the money. However, the defendants did not make any restitution payments and therefore were all sentenced today.
Assistant District Attorney Duncan Levin is in charge of the prosecution under the supervision of Special Prosecutions Bureau Chief Leroy Frazer.
Mr. Morgenthau thanked New York State Attorney General Eliot Spitzer, Assistant Attorney General Michael Jones of the Office of New York State Attorney General, Securities Bureau; and intern Bruce Alderman for their assistance with this investigation.
Defendant Information:
Ivory T. Fields, Jr., 12/5/72
355 Carlton Avenue, Apt. 1
Brooklyn, New York
Lesgar Grant, 2/20/70
1147 Brooklyn Avenue
Brooklyn, New York
Christian Polanco, 6/9/72
158 Stanton Street, Apt. 3B
New York, New York
Terrance Blackett, 3/22/68
347 East 91st Street
Brooklyn, New York
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