NY State Broker Craig Zabala Charged with Fraud by Federal Prosecutors
Concorde Group Holdings Inc. president Craig Zabala, an investment professional, was arrested on September 24, 2020 on fraud charges, according to a press release issued by the U.S. Attorney’s Office for the Southern District of New York. The press release was followed by the SEC’s announcement that a complaint was filed against Craig Zabala for defrauding the Concorde Group Holdings investors.
The team of securities lawyers at Rosca Scarlato LLC, led by investor rights advocate and adjunct securities professor Alan Rosca, are actively investigating potential recovery options on behalf of investors who have fallen victims to Craig Zabala’s alleged fraudulent misconduct. The team has extensive experience in fighting for investors who have been victims of investment fraud and Ponzi schemes.
Investors in Concorde Group Holdings who believe they lost money or have information that can assist Alan Rosca and his team in their investigation of Craig Zabala’s alleged fraud are encouraged to call 888-998-0530, email at arosca@rscounsel.law, or send a message through the contact form on this page.
Stockbroker Craig Zabala Has Been Subject to FINRA Sanctions For His Involvement in Outside Business Activities
A resident of New York State, Craig Anthony Zabala has been a broker registered with FINRA since May 1997, when he passed his Series 7 securities exam. Over his 15 year-long career as a broker, he has been registered with eight different broker dealers:
- between May 1997 and March 1998, Craig Zabala was registered with Merrill Lynch, Fenner & Smith Incorporated;
- starting January 2000 until July 2001, Zabala was registered with Trautman Wasserman & Company, a broker dealer expelled by FINRA on June 12, 2007;
- Zabala was then registered with Allmerica Investment for a short period between October 2001 and March 2002;
- between June 2002 and September 2003, Zabala was registered with Brean Murray & Co, Inc.;
- come May 2004, Craig Zabala moved to Independent Securities Investor Corporation, where he remained registered until May 2005;
- after a year-long break from being a broker, Zabala registered with Intercoastal Financial Services Corp, where he stayed only until November 2006;
- between June 2007 and August 2013, Zabala was a broker with Torsiello Securities, Inc.
- Zabala’s most recent employer was John W. Loofbourrow Associates, Inc. in Harlem, NY, where Zabala operated between February 7, 2015, until April 29, 2019.
Shortly after ending his registration with John W. Loofbourrow Associates, Inc., Craig Zabala was permanently barred by FINRA for his refusal to produce all documents and information requested by FINRA in connection with its review of Zabala’s outside business activities, and his alleged participation in private securities transactions. Without admitting or denying the facts, Zabala signed FINRA’s Letter of Acceptance, Waiver and Consent on August 19, 2019, thus being barred from association with any FINRA member in any capacity.
Investors in Concorde Group Holdings Were Allegedly Defrauded Of Close to $4.4 Million
Public records under review by attorney Rosca indicate that the CEO and the President of Concorde Group Holdings Inc. was arrested on September 24, 2020 in connection to the multimillion-dollar alleged securities fraud scheme.
“It can always be said, greed has a way of overcoming honest business practices; and in this case Mr. Zabala allegedly exhibited an indifference to investing regulations and the truth when he lied to his investors to enhance his lifestyle and enrich himself. As alleged, this case has all the elements of a classic Ponzi scheme. Investors should remember where there is high reward, there is high risk. Always verify ‘once in a lifetime’ investment claims to ensure you won’t be taken for a ride,”
said Philip R. Bartlett, the USPIS Inspector-in-Charge.
Indeed, according to the complaint, between 2015 and 2020, Zabala was allegedly involved in a scheme to defraud 18 victims who invested their money in Concorde Group Holdings notes, warrants, and equity. Reportedly, the victims of Zabala’s alleged scheme invested in a Concorde Group Holdings private offering of $25 million in senior secured notes promising 13% interest.
Among the false representations allegedly made by Zabala, the criminal complaint against him details how he often misrepresented that the money from the offerings would be used to expand Concorde Group Holdings by acquiring and investing in other financial companies. Zabala also allegedly told investors in Concorde Group Holdings that the company would soon have an Initial Public Offering which would result in profits for investors. Moreover, Zabala reportedly told investors that he is $1 million away from reaching the $25 million goal of the private offering, when he never got close to $5 million, the complaints allege.
72% of Funds Invested in Concorde Group Holdings Misappropriated by Craig Zabala
The SEC complaint, as well as the criminal complaint under the review by investor rights advocate Alan Rosca and his team, detail how Craig Zabala and his girlfriend and co-defendant in the SEC action, Doreen McCarthy, allegedly misappropriated close to $3.2 million of investor funds, or 72% of the total. The complaint goes on to allege that Zabala used close to $2 million of investor money for personal use, and used $1.2 million to make Ponzi-like payments to investors in Concorde Group Inc., the parent company of Concorde Group Holdings.
Allegedly, Zabala transferred investor money to McCarthy via 186 separate checks with the amount between $31 to $100,000. Craig Zabala also reportedly used close to $600,000 investor funds to cover charges on his personal American Express credit card. In addition, he made 471 ATM withdrawals totaling more than $130,000 of investor funds, the complaint states, and gave himself more than $500,000 in salary payments which according to SEC, were contrary to Concorde Group Holdings PPMs.
Finally, it is important to note that, as of the date of this article, there has not been a finding of liability as to the complaints or allegations mentioned in this article, unless otherwise indicated. Any reader should also read the original sources hyperlinked in this blog for accuracy, including any BrokerCheck report and/or record of any disciplinary or regulatory action. Those sources are incorporated by reference into the text of this blog, and are the governing materials in case of any inconsistencies or typos in this blog.
Investors in Concorde Group Holdings May Have Recovery Options Securities Lawyers Note
Investors who have concerns about their investments with Craig Zabala should discuss their case with a securities attorney. The Rosca Scarlato LLC lawyers have recovered millions of dollars on behalf of investors who experienced losses as a result of broker misconduct or securities fraud. They take cases like this on a contingency fee basis, advance all the costs, and only get reimbursed if the case is won. Investors are not required to pay any fees or expenses if there is no recovery.
Investor rights advocate Alan Rosca and his team are investigating the allegations involving former broker Craig Zabla and are prepared to take action and seek compensation on behalf of Concorde Group Holdings investors. Contact attorney Alan Rosca or his colleagues at 888-998-0530, via email at arosca@rscounsel.law, or through the contact form on this webpage, to discuss recovery options. All consultations are free.
