For Immediate Release
March 5, 2009
United States Attorney Thomas P. Colantuono
New Hampshire Attorney General Kelly Ayotte
Commissioner Peter Hildreth
New Hampshire Banking Department
CONCORD – United States Attorney Thomas P. Colantuono, New Hampshire Attorney General Kelly Ayotte, New Hampshire Banking Commissioner Peter Hildreth, and Special Agent-In-Charge Warren T. Bamford of the Boston Division of the Federal Bureau of Investigation, announced the filing of charges against the following individuals:
The charges are the result of a federal investigation of fraudulent investment practices at NTC the fraudulent acquisition of high value life insurance policies through Balcarrres.
Documents filed in United States District Court today allege that a number of NTC's customers' funds were held in a product that was created and managed by Lindsey, the Noble Alternative Income Fund (NAIF). Each customer for whom an NAIF account was established was assured that they would receive annual interest payments of at least 12 percent, which, at the account holder's option, would be paid on a periodic basis or as a lump sum when the account was closed. Prosecutors have also alleged that Lindsey used funds held in the NAIF accounts to make separate loans to a company in Colorado, Sierra Factoring, Inc.
According to the documents filed today, Sierra's last payment to NTC was made in August 2006, which severely compromised NTC's ability to make payments to the NAIF account holders. The documents also allege that from October 2006 to September 2007, Lindsey used more than $780,000 that belonged to new customers of NTC to make payments to existing NAIF account holders, in violation of the fiduciary duty Lindsey owed to the new customers. Lindsey concealed his use of the money that belonged to the new customers by mailing quarterly account statements to existing NAIF account holders which falsely reported that the current market value of each account was at least equal to the amount of money that was originally placed in it.
The court documents also charge that Elliott knew that Lindsey had committed fraud in connection with the handling of the NAIF accounts, and that she failed to report the crime to an appropriate authority.
The charges against Lindsey further describe efforts by he made to replace monies lent to Sierra by obtaining commissions from insurance companies which sold high value life insurance policies to customers of Balcarres. The charges state that Marino referred prospective customers to Lindsey, and Lindsey in turn paid Marino a fee each time one of his referrals purchased a high value life insurance policy through Balcarres. Court documents allege that from approximately October 2006, to October 2007, Marino provided false information regarding the applicants' personal financial status to Lindsey. After learning that applicants' personal financial information was false, Lindsey nevertheless caused the false information to be mailed with applications for policies to the insurance companies. As a result of that conduct, Lindsey received commissions totaling approximately $5.5 million and paid approximately $2.1 million of that money to Marino.
No dates have been set for Lindsey, Elliott or Marino to appear in court.
The documents filed today contain allegations, not proof, of criminal conduct. As in all criminal cases, the defendants are presumed to be innocent until proven guilty beyond a reasonable doubt.
New Hampshire Department of Justice | 33 Capitol Street | Concord, NH | 03301