Fordham Law

CMM Wins Against Agape Brokers Agape World victims win $4.1 million judgment

Alumnus Joe Campolo '97 in Long Island Business News, April 19, 2013

Media Source

Eight victims of Long Island's largest-ever Ponzi scheme have won a judgment of $4.1 million against a brother and sister who sold them the bogus investments.

Suffolk County Supreme Court Judge Emily Pines ruled Tuesday that Martin Hartmann III, 38, of Massapequa, and Laura Ann Tordy, 43, of Wantagh, were guilty of racketeering, fraud, negligent misrepresentation and unjust enrichment, in selling the plaintiffs $1.36 million worth of investments in Agape World, which was actually a $400 million Ponzi scheme orchestrated by Nicholas Cosmo.

It is the first successful civil suit brought by victims against brokers or sub-brokers in the Agape World fraud.

Hartmann's father, Martin Hartmann Jr., 67, a former Nassau County police officer from Massapequa, was also a defendant in the civil suit, but Pines is reserving decision on his participation in the scam until May 20.

Last June, Hartmann III and Tordy were two of 14 former Agape World brokers charged with fraud by the SEC. The pair worked as sub-brokers of Agape's most prolific salesman Jason Keryc, and offered and sold Agape securities to at least 441 investors, earning more than $3.5 million in commissions and payments, the SEC charged.

Keryc, 35, and three other former Agape World brokers were arrested and charged with fraud by the U.S. Attorney's office in April 2012. Keryc along with Anthony Ciccone, 40, Diane Kaylor, 37, and Anthony Massaro, 41, received about $38 million of the approximately $60 million paid out to brokers and sub-brokers in Agape World commissions, according to the federal complaint. Those brokers are out on $1 million bail awaiting trial.

According to the civil suit, Hartmann Jr., Hartmann III, who had previously worked for a Manhattan headhunting firm, and Tordy represented to the investors that 99 percent of their investments were safe and that their money would be used to fund bridge loans for commercial real estate projects.

However, Cosmo, who is currently serving a 25-year sentence for the Ponzi scheme, spent a lot of the company's investor money to gamble on high-risk futures and currency trades, losing more than $80 million, federal officials say. Total losses in the scam are pegged at $179 million, also the amount of restitution that Cosmo's been ordered to pay.

Defense attorney Howard Greenberg declined to comment because the judgment hasn't been officially entered and signed.

"The court case is continuing," Greenberg said.

Plaintiffs' attorney Joe Campolo, of Bohemia-based Campolo Middleton, thanked the judge for "seeing this case for what it was."

"There are no winners when a tragedy like this happens and so many lives are ruined," Campolo said.