U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 23562 / June 9, 2016
Securities and Exchange Commission v. James R. Trolice, Lee P. Vaccaro, and Patrick G. Mackaronis, Civil Action No. 16-CV-02513 (United States District Court for the District of New Jersey, filed May 4, 2016)
SEC Obtains Final Judgment Against Patrick G. Mackaronis and Lee P. Vaccaro Pleads Guilty to Federal Criminal Charges
The Securities and Exchange Commission announced today that, on June 6, 2016, the Honorable William J. Martini of the United States District Court for the District of New Jersey entered a final judgment against defendant Patrick G. Mackaronis. The court imposed on Mackaronis permanent injunctive relief and ordered payment of disgorgement, prejudgment interest, and a penalty for a total of $143,486.91.
In its Complaint, the Commission alleged that Mackaronis, a former stockbroker, received commissions for his involvement in an offering fraud scheme allegedly perpetrated by the other two defendants charged in this matter, James R. Trolice and Lee P. Vaccaro. Trolice and Vaccaro raised approximately $6 million from more than 100 investors for limited liability companies they owned and controlled that purportedly held warrants to purchase the common stock of a technology startup company. Trolice and Vaccaro created a false sense of urgency and exclusivity around the offering, claiming that only a limited amount of warrants were available and that they eventually could be exercised at a very profitable price. Mackaronis ignored fraud risks and blindly touted the opportunity to family members, friends, and brokerage clients while knowing very little about the investments themselves.
The final judgment permanently enjoins Mackaronis from violating Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 ("Securities Act") and Section 15(a) of the Securities Exchange Act of 1934 ("Exchange Act"). In addition, the final judgment orders that Mackaronis pay $85,000 in disgorgement, $8,486.91 in prejudgment interest, and a $50,000 penalty. Mackaronis consented to the entry of the final judgment.
On June 2, 2016, Vaccaro pleaded guilty to federal criminal charges for conspiracy to commit securities fraud and securities fraud in a parallel criminal action before the District Court for the District of New Jersey in United States v. Vaccaro, 2:16-cr-254 and consented to a judgment of forfeiture in the sum of $5,437,691.85. Sentencing is scheduled for September 13, 2016.
For further information, see Litigation Release No. 23532 (May 5, 2016).