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U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 23512 / April 7, 2016

United States v. Edward Laborio, et al., No. 12-cr-10238-FDS-JGD (D. Mass.)

Securities and Exchange Commission v. Edward M. Laborio, et al.
, Civil Action No. 1:12-cv-11489-MBB, (D. Mass. filed Aug. 10, 2012)

Former Boiler Room Operator Sentenced to Six Years' Imprisonment

The Securities and Exchange Commission announced today that on April 4, 2016, California resident Jonathan Fraiman was sentenced to six years in prison, three years of supervised release, and ordered to pay restitution of $3,800,466.

On August 7, 2014, Fraiman was criminally indicted by a federal grand jury, and was arrested on August 27, 2014. In December 2015 after an 11-day criminal trial, Fraiman was convicted of mail fraud and conspiracy to commit mail and wire fraud. In imposing sentence, U.S. District Judge F. Dennis Saylor, IV noted the "coldhearted" nature of the crimes of which Fraiman was convicted, particularly given that some of the victims were elderly individuals who had lost retirement savings in the scheme.

The SEC previously charged Fraiman for the same conduct in a civil action. According to the SEC's complaint, filed in federal district court in Boston on August 10, 2012 against Fraiman, two other individuals, and the Envit entities, from January 2008 through late August 2009, Fraiman participated in a fraudulent "boiler room" operation that raised more than $4 million from approximately 150 investors primarily through the use of false promises and pressurized sales tactics with regard to the sale of securities in a group of related entities, most with the name "Envit," that were owned and controlled by another defendant, including a non-existent hedge fund.

On October 8, 2013, the court in the SEC's civil action entered judgment against Fraiman enjoining him from future violations of the antifraud provisions of the federal securities laws. On October 11, 2013, the SEC issued an Order barring Fraiman from any future association with any broker, dealer, investment adviser, municipal securities dealer, municipal advisor, transfer agent, or nationally recognized statistical rating organization, with the right to reapply after ten years. Fraiman consented to both the judgment and the SEC's Order.

The SEC thanks the U.S. Attorney's Office for the District of Massachusetts for its efforts in prosecuting the case and recognizes the valuable assistance of the Boston Field Office of the Federal Bureau of Investigation.

For more information, see Litigation Rel. No. 22444 (August 10, 2012) [Civil Complaint]; Litigation Rel. No. 22836 (October 8, 2013) [Fraiman settlement]; Exchange Act Release No. 70678 (October 11, 2013) [Fraiman Order]; and Litigation Rel. No. 23430 (December 16, 2015) [Fraiman guilty verdict].

 

http://www.sec.gov/litigation/litreleases/2016/lr23512.htm


Modified: 04/07/2016