PRESS RELEASE
Connecticut Investment Advisor Admits Defrauding Clients of $2.7 Million Through Cherry-Picking Scheme
Friday, October 6, 2023
For Immediate Release
U.S. Attorney’s Office, District of Connecticut
Vanessa Roberts Avery, United States Attorney for the District of Connecticut, and Robert Fuller, Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation, today announced that JONATHAN VINCENT GLENN, 54, of Greenwich, waived his right to be indicted and pleaded guilty yesterday in Hartford federal court to defrauding investment clients through a “cherry-picking” securities scheme.
“Cherry-picking” is a fraudulent securities trading practice in which the responsible individual executes trades without assigning those trades to a particular trading account until the individual determines whether or not the trade has become profitable or suffered losses. The responsible individual then allocates the profitable trades to favored accounts – often the individual’s own accounts – and assigns unprofitable trades to disfavored client accounts.
According to court documents and statements made in court, Glenn owned Glenn Capital LLC, also known as GlennCap LLC, an investment advisory firm headquartered in Greenwich. Through Glenn Capital, Glenn provided clients with portfolio management services including asset selection and asset allocation. Glenn managed all of Glenn Capital’s advisory clients’ accounts and was authorized to make trading decisions on each client’s behalf without seeking approval for each trade. Glenn placed trades on behalf of advisory clients, himself, or family members by trading directly in the relevant individual account, or by placing block trades in Glenn Capital’s omnibus account and allocating the block trades among the relevant individual accounts. Glenn Capital’s Code of Ethics required Glenn to determine and document the specific allocation of each block trade prior to the execution, and to allocate block trades to individual accounts at an average price.
In pleading guilty, Glenn admitted that he defrauded clients by retroactively allocating profitable omnibus-account trades to favored clients, family, and personal accounts, and unprofitable omnibus-account trades to non-favored-client accounts. Notwithstanding the requirements set forth in the Code of Ethics, Glenn did not determine the allocation of block trades until after they were executed, when he knew if the trades were profitable in the hours following the execution. When a block purchase of an equity security increased in value in the hours after the purchase, Glenn generally realized the profits by selling the security. He then allocated those profits to favored-client, family, firm, and personal accounts. When a block purchase of an equity security decreased in value, Glenn generally allocated those block purchases to the non-favored-client accounts. Glenn did not inform his clients that he was “cherry picking.” Instead, he gave the false impression that he allocated trades fairly and according to a pre-determined allocation methodology.
Through this scheme, Glenn defrauded more than 45 clients of a total of more than $2.7 million.
Glenn pleaded guilty to one count of securities fraud, which carries a maximum term of imprisonment of 25 years and a fine of up to approximately $5.4 million. Glenn is released pending sentencing, which is scheduled for December 28.
This matter has been investigated by the Federal Bureau of Investigation with the assistance of the U.S. Securities and Exchange Commission, which has settled fraud charges with Glenn and GlennCap LLC.
This case is being prosecuted by Assistant U.S. Attorney Heather L. Cherry.
Updated October 6, 2023
「摘櫻桃」詐騙45名投資者270萬 投資顧問認罪面臨最高25年刑期
2023-10-07
00:08:35
一名涉嫌對近50名受害者展開投資詐騙的投資顧問於日前就其罪行認罪，或將面臨最高25年的刑期。在向公眾匯報相關案件進展的同時，當局亦提醒民眾小心防範，謹慎對待任何投資決策。
根據檢方，這名涉案人員為一名叫做格林（Jonathan Vincent Glenn）的男子，現年54歲。他被指控通過「摘櫻桃」（cherry-picking）的證券欺詐騙局，對45名客戶進行了投資詐騙。
所謂「摘櫻桃」詐騙，指的是一種欺詐性的證券交易行徑。在其過程中，責任人在執行交易時不會將交易分配到特定的交易賬戶，直到責任人確定交易是否盈利或虧損。在這之後，責任人將盈利的交易分配到有利的賬戶，而降無利可圖的交易則會分到不利的賬戶中。通常來講，所謂有利賬戶即負責人的個人賬戶，而不利賬戶則指客戶的賬戶。
根據法庭文件，格林擁有並運營著一家名為「格林資金」（Glenn Capital LLC）的投資顧問公司。而格林則通過該公司，為客戶提供投資組合管理服務，包括資產選擇和資產配置。所有咨詢客戶的賬戶均由格林本人管理，並有權代表每位客戶做出交易決定，且無需就每筆交易尋求批准。
而格林代表客戶、他本人或家庭成員進行交易的方法，便是直接在相關個人賬戶中進行交易，或在其公司的總賬戶中進行大宗交易，並在相關個人賬戶中對大宗交易進行分配。根據相關規定，格林在執行前確定並記錄每筆大宗交易的具體分配情況，並按平均價格將大宗交易分配給個人賬戶。
格林在認罪時承認，他通過將獲利的總賬戶交易追溯分配到有利客戶、家庭和個人賬戶，將無利可圖的總賬戶交易分配到不利客戶賬戶的方式，對客戶進行了欺詐。儘管有相關規定做規範，但格林直到大宗交易執行後才確定交易的分配，只因在執行後得幾個小時內，他才能知道交易是否盈利。
而當大宗交易買入的股票在買入數小時內增值時，他則會通過賣出股票來實現利潤。然後再將這些利潤分配到偏愛的客戶、家族、企業和個人賬戶中。相反，當大宗購買的股票價值下降時，他則會將這些股票分配到非優惠客戶的賬戶中。給客戶造成他在按照預先確定的分配辦法公平地分配交易的假象。如此行為即在客戶中間挑挑選選地「摘櫻桃」。
檢方表示，格林通過這一騙局，共向至少45名客戶詐騙了總額超過270萬元的資金。他因此被訴以一項證券欺詐罪，並已於日前認罪。如若罪成，屆時將面臨最高25年刑期和540萬元罰款。目前他已有保獲釋，暫定12月28日宣判。
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