ROCHESTER, N.Y. (WROC) — A Rochester man has admitted to his role in a nationwide, fraudulent scheme that scammed more than 1,000 people out of tens of millions of dollars.
U.S. Attorney James Kennedy announced Monday that Perry Santillo Jr. pleaded guilty to a number of charges, including conspiracy to commit mail fraud, mail fraud, and conspiracy to launder money. These charges carry a maximum penalty of 20 years in prison and a $1,000,000 fine.
Kennedy said Santillo was investing in “City Capital Corporation” without knowing it was a ponzi scheme. When that company went under, Santillo bought it himself, in an attempt to gain back some of the money he’d lost.
Ultimately, he wound up going from a victim of the scheme, to running it.
U.S. Attorney James Kennedy said Santillo cheated more than 1,000 people for more than $100 million with false promises of business investments.
George Conboy is the chairman of Brighton Securities. He said scammers have ways to hide schemes like this.
“A Ponzi scheme can keep itself hidden for a long time by taking in money from new investors and using that to pay old investors. The old investors don’t complain because they’re getting paid. So until the scammers eventually run out of new victims, the scheme is often not reported to authorities,” said Conboy.
Officials also described Santillo’s lavish lifestyle, which included luxury cars, a $150,000 birthday celebration in Las Vegas, $1.2 million worth of suits and commissioning a rap song about himself, among other examples.
Although the scheme was wide-reaching and operated throughout the country, a few local families were impacted, including:
- A resident of Webster who invested a total asset value of $94,341.89 in a fictitious company known as First Nationale Solutions (FNS), which was worthless as of December 31, 2017.
- A Victor resident and his wife invested approximately $221,758.67 with FNS and Millebury Development. Officials say the couple received three payments of $2,500 but lost approximately $214,258.67.
Kennedy said investment advisers violating trust in a situation like this isn’t uncommon.
“Often times, people enter into these investment schemes as an opportunity to make money, and they’re operated as best they can for a period of time, but feeling the mounting pressure, they being to take shortcuts to engage in fraudulent behavior, and as this case did spiral out of control, snowballed I should say, into a massive fraud,” Kennedy said.
Santillo is scheduled to be sentenced March 6.
Officials say this investigation is ongoing.
Full court paperwork:
Check back with News 8 WROC as we will continue to update this developing story.