After pleading guilty to a fraud scheme as well as grand larceny charges,
financial planner Jay Hoffman was sentenced to up to seven years in jail.
For sentencing purposes, the former president of Security Income Planners
admitted to fraudulently obtaining funds from family, friends, and other
clients of his Bay Shore firm.
Prosecutors allege that Hoffman lured investors with promises of returns
of up to 12 percent. However, bank records and other evidence show that
he did not actually invest the savings entrusted to him by his clients.
According to Suffolk County District Attorney Thomas Spota, “[…]
(Hoffman) would use investor A’s money to pay ‘interest’
to investor B—while pocketing a hefty cut for his personal expenses.”
Hoffman allegedly ran the
Ponzi scheme out of his company, originally based in Syosset, between the dates of
January 1989 and October 2009.
Many individuals who invested with Hoffman were not aware of any potential
fraud until Suffolk prosecutors launched an investigation. Authorities
believe that Hoffman may have had as many as 40 victims, including his
family members and many of his childhood friends.