Belle Harbor Man Gets Seven Years
A Belle Harbor man convicted for a phony hedge fund scheme where he robbed six investors of more than $7 million was sentenced to seven years in prison last week at Manhattan Federal Court.
Yevgeny Shvartsshteyn and accomplice Igor Levin pleaded guilty in December to federal fraud charges. The two men were responsible for setting up and running a phony hedge fund that was initiated through cold calling and mail literature to prospective investors in 2005 and 2006. The men told investors that their company, A.R. Capital, was a hedge fund that invested primarily in international real estate companies, as well as oil, gas, and other commodities.
Unfortunately those proposed companies did not exist and investors lost millions. The two men never produced any financial returns and they sent more than $7 million in cash to Ukrainian bank accounts. The Securities and Exchange Commission shut down the operation in September 2006 and made the arrests of the two men along with other unnamed conspirators.
U.S. District Judge Sidney Stein ordered the convicts to forfeit the $7 million in illgotten gains.
According to published reports, neither man is a stranger to the legal system. Both men have criminal records. Levin was incarcerated in 1992 for 11 months for a firearms charge followed by a misdemeanor charge of possessing stolen property in 1993. Shvartsshteyn was also convicted of mail fraud in 2001 and served 27 months in prison.