Feds: Linwood Man Charged With Securities Fraud, Embezzlement
A man from Linwood has been charged with orchestrating what is described as a long-running securities offering fraud while simultaneously embezzling hundreds of thousands of dollars, according to authorities.
Acting U.S. Attorney Rachael Honig says 54-year-old Joseph Geromini has been charged with ten counts of wire fraud and two counts of securities fraud.
According to Honig's office, Geromini was the chief operating officer for a start-up technology company based in Philadelphia which, "specialized in the development of point-of-care diagnostic testing of various diseases."
Geromini controlled the company’s financial accounts and was responsible for finding investors in the company through debt and equity fundraising. Authorities say in 2018, nearly $2.25 million of investor funds were raised.
"Geromini misrepresented to investors that he would invest their funds to pursue the company’s business plan, for example, by using the funds to further develop and commercialize its products and services, for lab expenses, and to pay employee salaries. Instead, Geromini diverted significant portions of their funds out of the company’s bank account for purposes inconsistent with its business operations, including to pay himself hundreds of thousands of dollars through unauthorized wire transfers, ATM cash withdrawals, and debit card transactions."
The government also alleges that,
"Geromini frequently misrepresented to the company that the unauthorized wire transfers were intended to compensate him for his employment. Geromini told the company’s chief executive officer that Geromini had twice secured contracts on behalf of the company with third parties and was, pursuant to his employment agreement, entitled to separate bonus payments."
Should Geromini be found guilty, each wire fraud counts carries up to 20 years in prison and a $250,000 fine. The securities fraud counts each carry up to 20 years in prison and a $5 million fine.
Geromini was scheduled to have an initial court appearance and arraignment Wednesday afternoon.