Criminal Justice News

Friday, July 31, 2015

Founder And Managing Partner Of R2 Capital Group LLC Pleads Guilty In Connection With Commodities Investment Scheme



Preet Bharara, the United States Attorney for the Southern District of New York, announced today that RYAN TOMAZIN, the founder and managing partner of R2 Capital Group LLC (“R2 Capital”), pled guilty in Manhattan federal court to a two-count Indictment charging him with defrauding investors and misappropriating investment funds.  TOMAZIN and other principals at R2 Capital caused over $850,000 of investors’ funds to be withdrawn from bank accounts associated with the commodity pool and directed to bank accounts held in their own names or that of their respective holding companies.  TOMAZIN was arrested on December 11, 2014 and pled guilty today before United States District Judge Paul A. Crotty.

Manhattan U.S. Attorney Preet Bharara said:  “As Ryan Tomazin acknowledged today by pleading guilty to securities and commodities fraud, he lied to investors and used his company to line his own pockets with investors’ money.”

According to the Indictment, and other statements made in open court:

In late 2009, R2 Capital created a commodity pool, R2 Capital Partners I L.P. (the “Commercial Pool”) and began to solicit investors, eventually raising approximately $2.2 million.  In early 2010, TOMAZIN solicited a potential investor in the Commercial Pool (“Investment Fund-1”) and provided Investment Fund-1 with documentation that stated, among other things, that R2 Capital would receive a management fee limited to 50% of the profits earned by the Commercial Pool.  Investment Fund-1 invested over $1 million in the Commercial Pool.  From June 2010 up to and including July 2011, the Commercial Pool experienced significant net losses.  In July 2011, all trading activity in the Commercial Pool ceased.  By August 2011, there was less than $5,000 remaining in bank accounts associated with the Commercial Pool.  Nonetheless, between August 2011 and March 2013, TOMAZIN caused false “Trading Statements” to be sent to Investment Fund-1 reflecting false purported monthly trading profits and inaccurate trade balances.  Furthermore, contrary to prior representations that R2 Capital’s management fee would be limited to 50% of profits earned, TOMAZIN and other principals at R2 Capital caused approximately $850,000 to be withdrawn from bank accounts associated with the Commercial Pool for their own personal benefit.

TOMAZIN, 35, of Stamford, Connecticut, pled guilty to one count of securities fraud and one count of commodities fraud.  The securities fraud charge carries a maximum term of 20 years in prison and a maximum fine of $5 million, or twice the gross gain or loss from the offense.  The commodities fraud charge carries a maximum term of 10 years in prison and a maximum fine of $1 million, or twice the gross gain or loss from the offense.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  As part of the plea agreement, TOMAZIN agreed to pay forfeiture and restitution to the victims of the offense in the amount of $288,000.  TOMAZIN is scheduled to be sentenced by Judge Crotty on December 3, 2015.

The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Mr. Bharara thanked U.S. Commodity Futures Trading Commission for their assistance with the investigation.

This case is being handled by the Office’s Securities and Commodities Fraud Task Force. Assistant U.S. Attorneys Harry Chernoff and Aimee Hector are in charge of the prosecution.

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