Coral Springs resident Ronald Filoramo, 54, a former securities broker and investment adviser for Morgan Stanley Smith Barney, is accused by the U.S. Securities and Exchange Commission of stealing $761,000 from two longtime customers and spending most of it on gambling and related expenses.
A complaint filed Thursday in U.S. District Court in Miami says the thefts took place between February 2017 and October 2021 and were discovered earlier this year after Filoramo’s wife became concerned about his location and contacted his employer.
The call prompted Filoramo’s employer to review his customer transactions, which revealed the thefts and resulted in his termination, the complaint states.
Filoramo’s customers were a husband and wife who lost about $61,444 and an elderly man who controlled several accounts for his wife, children and grandchildren, according to the SEC’s lawsuit. He lost $700,000, the suit states.
According to the SEC’s complaint, Filoramo in February 2017 began recommending that the customers invest in high-yield bonds that he said were owned by a wealthy client of Morgan Stanley Smith Barney. But Filoramo never purchased any bonds for the customers, and instead told them to make their investments directly to that client, a friend of Filoramo, who then transferred nearly all of their money to Filoramo’s personal bank account.
“Filoramo, in turn, used this money to make numerous, large cash withdrawals, many of which occurred at casinos,” the complaint states.
Filoramo perpetuated the scheme by providing the customers with fraudulent documentation for the bond purchases, including screenshots from the broker-dealer’s order entry system and internal analyses of bonds, the SEC said.
Filoramo is charged with six counts of violating U.S. securities laws.
To resolve the charges, Filoramo agreed to pay disgorgement, prejudgment interest and civil penalties that will be determined by the court later, an SEC news release said. The settlement is subject to court approval.
Filoramo’s attorney, Jim Salleh, said by phone that his client “is pleased to have reached a settlement of this case with the SEC without protracted litigation and is happy to have the matter behind him.”
Ron Hurtibise covers business and consumer issues for the South Florida Sun Sentinel. He can be reached by phone at 954-356-4071, on Twitter @ronhurtibise or by email at rhurtibise@sunsentinel.com.