A former investment adviser and broker has been sentenced to nearly six years in prison after pleading guilty to stealing millions of dollars from his clients to pay for his personal expenses.
Gary Basralian, 72, of Springfield, New Jersey, was sentenced to 70 months in prison by a US District Court judge on one count of wire fraud and one count of investment adviser fraud. According to court documents, Basralian was a registered broker who provided investment advisory services to clients and received compensation for advising them about securities investments.
From 1989 until December 2017, he was registered with the Financial Industry Regulatory Authority (FINRA) working at a registered investment adviser and broker-dealer located in Jersey City, New Jersey. The firm, known only as “Securities Firm A” in court documents, provided a broker-dealer platform for more than 2,000 independent financial advisers across the US.
For more than 10 years, spanning from July 2007 through November 2017, Basralian defrauded his clients by telling them that he would invest their money in securities and other investments. However, he used those funds for his own personal expenses , including funneling hundreds of thousands of dollars to pay his American Express credit card bills, and thousands of dollars in BMW and mortgage payments.
When certain clients inquired about the status of their investments, Basralian falsely assured them that their money was invested in real estate, high-interest loans, or securities.. In one instance, Basralian wired money from at least one client’s investment account to accounts that he controlled and used the proceeds for his own benefit.
When the client asked why the account’s value had declined, Basralian provided a fabricated spreadsheet showing that the money was being invested as loans to various companies. He also falsely told the client that the money would be paid back with interest. In the end, Basralian admitted stealing at least $2 million.
In addition to the prison term, Judge Arleo sentenced Basralian to three years of supervised release. In May of 2018, the New Jersey Bureau of Securities revoked Basralian’s agent and investment adviser representative registrations.