Southern District Court - New York

Nanuet Man Found Guilty Of Ponzi-Style Scheme That Stole $2.6 Million From Investors

Business Government Other News Real Estate
RCBJ-Audible (Listen For Free)
Voiced by Amazon Polly

Ruless Pierre’s Fraud Targeted Haitian Community


Move over Bernie Madoff.

Ruless Pierre, 51 of Nanuet, was convicted last week in Manhattan federal court of two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of structuring, which carries a maximum sentence of five years in prison.

The Rockland County man was found guilty of running a Ponzi-style scheme that prosecutors said targeted the area’s Haitian community. He was accused of stealing about $2.6 million from investors and his former employers, including a few scams between 2016 and 2019.

Pierre had pleaded not guilty to the charges, which were brought against him in November 2019.

The 51-year-old is free until his sentencing on Sept. 9.

“Today, Ruless Pierre was brought to justice for callously lying to investors,” said Audrey Strauss, the United States Attorney for the Southern District of New York.

“Pierre told investors their investment returns were excellent, when in fact he failed to invest investor funds as promised, generated losses when he did invest, and diverted much of investor funds to his personal use and to repay investors in a Ponzi-like fashion.  We will continue aggressively to pursue frauds like this one in order to protect investors.”

From November 2016 through October 2019, Pierre solicited money from investors of Ruless Pierre Consulting Group (“RPCG”) by falsely promising he would earn a 20 percent return on their initial investment every 60 days through stock trading. These investment contracts generally promised that the investor would be paid 20 percent interest every 60 days and that the investor could withdraw all funds from the investment with 30 days’ notice.

Over time, Pierre fraudulently obtained over $2 million from nearly 100 investors.  After receiving money from investors, Pierre deposited the money into one of his personal bank accounts or bank accounts of RPCG.  The defendant transferred the money to trading accounts, where he engaged in unprofitable day trading, the suit said.

Despite his trading losses, Pierre repeatedly and falsely represented to investors, including in investment statements containing fictitious balances, that the trading was profitable and that their investments were growing as promised, the suit said.

In addition to losing investors’ money, Pierre used investors’ funds to pay for personal expenses, including luxury vehicles, according to the findings of the court. Additionally, Pierre concealed the truth from investors by using money obtained from new investors to make redemption payments to previous investors, in Ponzi-like fashion.

In a second scheme, Pierre bought one fast-food franchise in April 2019 for about $50,000 after obtaining at least $200,000 from at least 18 investors, officials said. He was accused of using some of that money to pay back investors of his first scam involving the Ponzi-style strategy.

Beginning in or about November 2018, Pierre began to offer investors the opportunity to purchase partnership interests in a partnership that would run three fast-food franchise locations. Pierre did not own any of the fast-food franchises in Orangeburg, but he was in discussions regarding purchasing them. The “Silent Partnership Agreements” promised investors a 5 percent monthly return on the investment, in addition to a 40 percent pro rata share of the quarterly gross operating profit.  The minimum investment was $5,000.

The Silent Partnership Agreements further provided that Ruless Pierre was the General Partner, and that he was responsible “for the complete management, control, and policies related to the operation and conduct of the business.” Pierre received financial statements for the franchise locations, which showed minimal profits.

Some of the investors were paid their 5 percent monthly distribution, but the vast majority of the investors were not made whole. The fast-food franchise went out of business in December 2019.

A third scheme targeted two of Pierre’s former employers, officials said — a hotel in Palisades (now the HNA Palisades Training Center) in Rockland County and a hotel in Armonk in Westchester County. Pierre was the Controller for Dolce International at the IBM Palisades Conference Center.

Pierre was the director of finance for those hotels, which were owned by the same company, from 2007 until February 2016, officials said. He no longer worked at those hotels after August 2018, officials said, but he regularly wrote himself checks from the bank accounts of his former employers after that period. He was accused of writing about 94 checks for $403,890, payable to cash, between September 2018 and March 2019. Officials said he typically wrote those checks for less than $10,000 to avoid the filing of currency transaction reports for transactions of more than $10,000.

Officials said the fraud targeted the Haitian community, which has a strong presence in Rockland County, but no other details on the extent of those residents being targeted were immediately available. It was not immediately clear if there were resources to help the victims, but the U.S. Attorney’s Office said anyone with information on the crimes should call its office at  866-874-8900.