Attorney General James Announces Criminal Conviction and Civil Judgment Against Queens Investment Advisor for Defrauding Elderly Clients of Over $11 Million

Posted to Applied Web NY on Fri, 10/16/2020 - 15:46

Owner and Manager of Mustaphalli Capital Partners Fund, LP Sentenced to 3 to 9 Years in Prison

Mustaphalli Pays $260,000 in Restitution and Is Permanently Barred from Securities Industry

NEW YORK – New York Attorney General Letitia James today announced the conviction of former investment advisor Dean S. Mustaphalli — the owner of the now defunct Mustaphalli Capital Partners Fund, LP (MCPF) — for operating a multi-million-dollar securities fraud scheme aimed at defrauding over 50 investors — many of whom were elderly and at or near retirement. Mustaphalli invested much of these 50 individuals’ monies in his hedge fund without their knowledge or consent, bringing in more than $11 million between 2011 and 2016, and resulting in many of his victims losing their life savings. Today, in Queens County State Supreme Court — upon his guilty pleas to 22 felony charges, including Grand Larceny and Securities Fraud under the Martin Act — Mustaphalli was sentenced to 3 to 9 years in prison; paid $260,000 in criminal restitution; and signed confessions of judgment in favor of the victims named in the indictment, totaling more than $2.3 million dollars. As part of a separate civil order filed by the Office of the Attorney General (OAG) in New York County State Supreme Court, Mustaphalli entered into an additional judgment in favor of his victims in the amount of $6 million, and he is permanently barred from engaging in any business related to the issuance or sale of securities in New York.

Bulletin assigned to: