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Florida executive pleads guilty to orchestrating $150 million investment fraud scheme

4/19/2018 5:04:35 PM

SAINT PAUL – The Minnesota Commerce Department announced that a Florida man has pleaded guilty in federal court for his role in a $150 million investment fraud scheme that victimized investors worldwide, including in Minnesota. 

Antonio Carlos de Godoy Buzaneli, age 56, of Coral Gables, pleaded guilty to conspiracy to commit mail fraud before Senior Judge Michael J. Davis in U.S. District Court in Minneapolis. 

Two of Buzaneli’s co-conspirators pleaded guilty earlier. Jose Manuel Ordoñez, Jr., 47, of Davie, Florida, and Julio Enrique Rivera, 61, Pembroke Pines, Florida, each pleaded guilty to one count of conspiracy to commit mail fraud. 

Sentencing dates for the three defendants have yet to be scheduled.

This case is the result of an investigation conducted by the FBI, United States Postal Inspection Service and Minnesota Commerce Fraud Bureau. 

“The defendant directed a massive fraud scheme that victimized numerous investors worldwide,” said Minnesota Commerce Commissioner Jessica Looman. “Both our securities enforcement unit and the Commerce Fraud Bureau began investigating when we received a tip about a suspicious investment opportunity being offered in Minnesota. A successful collaboration between the Fraud Bureau and federal authorities uncovered a far-reaching, sophisticated scheme that deceived investors about how their money would be used.”

According to Buzaneli’s guilty plea, he and his two co-conspirators were the principals of Providence Holdings International, Inc., a company based in Key Biscayne, Florida. Buzaneli and Ordoñez became principals of Providence Financial Investments, Inc., and Providence Fixed Income Fund LLC (collectively, along with Providence Holdings International, Inc., “Providence”) in order to raise money from investors.

According to Buzaneli’s guilty plea and documents filed in court, from about 2010 until June 2016, Providence raised approximately $150 million from investors worldwide by representing that Providence would invest the money in Brazilian “factoring.”

Factoring is a financial transaction in which accounts receivable are purchased at a discount. Providence claimed to make a 48 percent annual return on money invested in Brazil.

According to Buzaneli’s guilty plea and documents filed in court, Providence raised more than $64 million from U.S. investors by employing a network of brokers who sold promissory notes bearing annual interest rates between 12 and 24 percent.  

Buzaneli and his two co-conspirators provided the brokers with marketing materials to show investors that their money would be used to factor accounts receivable in Brazil. The materials falsely stated that funds would be used “for the sole purpose” of making loans to a Brazilian subsidiary of Providence to acquire receivables or financial instruments in the Brazilian Factoring Market.

According to Buzaneli’s guilty plea and documents filed in court, he and Ordoñez instead used a significant amount of the investors’ funds to pay purported profits to other investors and to make commission payments to brokers. Buzaneli and Ordoñez also diverted investor funds to other companies they controlled.

Buzaneli and Ordoñez also opened Providence offices and affiliates around the world, through which they raised approximately $85 million from offshore investors by falsely representing they would use the investors’ money to invest in Brazilian factoring. In reality, much of the investors’ money was transferred to other Providence-controlled entities around the world as well as to bank accounts controlled by Buzaneli and Ordoñez.

As a result of the fraud scheme, Providence investors worldwide lost a total of more than $100 million.

“Antonio Buzaneli orchestrated a massive fraud scheme that victimized hundreds of individual investors around the globe, including in Minnesota,” said U.S. Attorney Greg Brooker. “Many of these victims were elderly or vulnerable, and they invested their hard-earned retirement savings based on sophisticated lies about a complex investment Mr. Buzaneli and his co-conspirators claimed to be making in Brazil. Instead, they used the investors’ money to fund their lifestyles, to travel first class around the world, and to fund their other business ventures. The U.S. Attorney’s Office is grateful for the skilled investigative efforts put forth by our law enforcement partners to hold Mr. Buzaneli and his co-conspirators accountable for their scheme.”

“This vast and sophisticated fraud scheme truly circled the globe, touching venues as near as St. Louis Park, Minnesota, and as far as Brazil, the United Kingdom, and China. Mr. Buzaneli and his co-conspirators lured their victims with the promise of novel international investments and huge financial returns. In reality, they stole millions simply to fund their personal interests and maintain their fraudulent conspiracy,” said Acting Special Agent in Charge Robert C. Bone II. “The FBI is committed to stopping these fraudsters and holding them accountable, no matter how complex the scheme or far flung the proceeds. We are grateful for the help of our partners at the U.S. Attorney’s Office, the United States Postal Inspection Service and the Minnesota Commerce Fraud Bureau in uncovering this complex scheme and bringing these defendants to justice.”

“Postal Inspectors take very seriously their mission to deter the illegal use of the mails for any criminal activity,” said Postal Inspector in Charge, Craig Goldberg. “We are committed to working together with our federal and local law enforcement partners to identify, investigate and bring to justice those who would attempt to mask their criminal activity through the use of the mail.”

Commerce is here to help

Media Contact
Ross Corson
Director of Communications
Minnesota Department of Commerce
p: 651-539-1463 | c: 651-368-5050 | ross.corson@state.mn.us

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