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Steven Pagartanis

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As his former office sits empty on North Country Road in Setauket, former investment adviser Steven Pagartanis will be spending time in jail.

The 60-year-old East Setauket resident appeared in Central Islip’s federal court Jan. 9 where U.S. District Judge Joan Azrack sentenced Pagartanis to 14 years in prison and also ordered him to pay more than $6.5 million in restitution, according to a press release from the U.S. Attorney’s Office for the Eastern District of New York. The former investment adviser was arrested May 30, 2018, and in December of the same year, pleaded guilty to charges of mail and wire fraud for orchestrating a securities fraud scheme for 18 years.

“Today’s sentence is a well-deserved reckoning for Pagartanis, who preyed on elderly investors, many of whom trusted him with their life savings, for nearly two decades,” said U.S. Attorney Richard Donoghue. “Protecting investors, especially those that are vulnerable, from white-collar criminals is a priority of this office and the Department of Justice.” 

According to the press release, from January 2000 to March 2018, Pagartanis targeted elderly women to invest in two publicly traded companies. He requested the victims write checks payable to an entity he secretly controlled. After laundering the investments using a series of bank accounts, he used the money to pay for personal expenses. He also funded failed business ventures that included his wife’s pet store. 

The defendant’s victims invested more than $13 million and sustained losses of over $9 million, according to the EDNY office.

Pagartanis’ attorney Kevin Keating, of Garden City, declined to comment.

Frank Napolitano’s mother, Roseanne Maggio, of Middle Island, lost nearly $70,000 in the scam. Since Maggio died in 2018, Napolitano attended the sentencing along with other victims.

He said he was satisfied with the sentencing and was surprised that the judge ordered Pagartanis to prison immediately. While to his knowledge his mother’s $70,000 is the smallest amount lost by a victim, he said money is relative to everybody.

“Seventy thousand to one person is $3 million to another person,” he said. “It’s really kind of all my mother had in terms of investing.” 

Napolitano said it was crazy to hear of all the luxury items Pagartanis purchased with the money, including vacations and luxury cars, especially since he targeted elderly women, most of whom had recently suffered an illness or death of a family member.

“It breaks your heart,’” he said.

Despite her passing, Maggio’s family will still see some restitution. Her son said his mother had hoped to leave money to her four grandchildren.

“They’re able to see a little something of grandma’s investment so it helps a little bit,” he said.

During an 18-year span, an East Setauket financial adviser allegedly scammed 17 people out of more than $13 million, according to a federal indictment.

The United States Attorney’s Office for the Eastern District of New York announced Steven Pagartanis faces nine federal charges.

Steven Pagartanis will face federal charges in addition to county charges for allegedly running a Ponzi scheme in East Setauket. Photo from Suffolk County District Attorney’s Office

The 58-year-old owner of Omega Planning Associates, was arrested and arraigned in federal court in Central Islip July 25 and was charged with security fraud, mail and wire fraud conspiracies, as well as money laundering for orchestrating a Ponzi scheme, according to a press release from the EDNY office.

The government alleged Pagartanis solicited individuals to invest in variable annuities, mutual funds and similar investments, according to court documents. At least 17 individuals between January 2000 and March 2018 invested more than $13 million collectively with the defendant. The victims believed the money was for real estate investments, including a Canadian land development company, referred to as Company 1 in court documents. The individuals sustained a loss of more than $8 million. The investors are listed as Jane and John Does in the court documents and live in various areas including Long Island, Illinois, California and Florida.

“Rather than investing in Company 1 and other investments as promised to the victims, the defendant Steven Pagartanis, used the investment capital to repay prior investors and for his own personal benefit,” the release reads. “For example, Pagartanis used the victims’ investment capital to pay for his personal and family expenses, and to purchase luxury items such as clothing, jewelry, airline tickets, massages and cigars.”

The defendant used interstate communications including telephone calls and emails to induce the victims to invest and to prevent them from withdrawing their investments, according to court documents.

“As alleged, Pagartanis conned vulnerable members of the community who had entrusted him with their hard-earned savings,” said Richard Donoghue, U. S. attorney, in a statement. “Protecting the elderly and the community at large from predators like the defendant is a priority of this office and the Department of Justice and with our law enforcement partners we will continue to pursue that mission.”

“As alleged, Pagartanis conned vulnerable members of the community who had entrusted him with their hard-earned savings.”

— Richard Donoghue

Pagartanis was previously arrested May 30 for allegedly stealing millions from elderly victims in a Ponzi scheme, according to a statement from the Suffolk County District Attorney’s office. He was arraigned in Suffolk County District Court in Central Islip on two counts of first-degree grand larceny, a B felony, and two counts of second-degree grand larceny, a C felony. According to the Suffolk County district attorney’s office, Pagartanis allegedly stole approximately $7.5 million from his victims in the county case.

A family member of one of the victims brought the case to the attention of the district attorney’s office. The four victims included in the felony complaints, who range in age from 64 to 83 years old, began investing in the scheme in 2013, according to the statement from Sini’s office.

Pursuant to a concurrent investigation by the Financial Industry Regulatory Authority, Inc., Pagartanis was barred from acting as a securities broker April 10, according to FINRA’s website, brokercheck.finra.org. The site lists customer disputes as well as a judgment/lien against the former broker. In addition to the criminal charges, a civil lawsuit was filed against Pagartanis May 30 by the U.S. Securities and Exchange Commission, according to Sini’s office.

Attorney Kevin Keating of Garden City is representing Pagartanis. The defendant pleaded not guilty. Keating did not respond to a request for comment.

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An East Setauket resident was arrested May 30 for allegedly stealing millions from elderly victims in a Ponzi scheme, according to a statement from the Suffolk County District Attorney’s office.

Steven Pagartanis, 58, was arraigned in Suffolk County District Court in Central Islip on two counts of first-degree grand larceny, a B felony, and two counts of second-degree grand larceny, a C felony. According to the district attorney’s office, Pagartanis allegedly stole approximately $7.5 million from his victims. Pagartanis was released following the arraignment on supervised release with GPS monitoring.

Steven Pagartanis allegedly stole approximately $7.5 million from elderly victims. Photo from Suffolk County District Attorney’s Office

“The defendant described to victims a great investment they could make by trusting him with their hard-earned money,” District Attorney Tim Sini said. “In some cases, victims gave the defendant their life savings. The defendant then used those monies to pay off earlier investors in his scheme and to fund his personal lifestyle.”

Pagartanis worked as a financial planner and is the owner of Omega Planning Associates, a financial planning business located at 100 North Country Road in East Setauket. He allegedly told victims he was investing their money in Genesis Land Development Corp., a building and land development company based in Calgary, Canada, according to Sini’s office.

Pagartanis then allegedly deposited the funds into an account called “Genesis Holding” and used the money to pay back prior investors in the scheme. The defendant also allegedly used some of the money on personal expenses, including retail purchases and dining.

“We’ve identified well over a dozen victims and we believe there are more victims out there,” Sini said.

The case was brought to the attention of the district attorney’s office by a family member of one of the victims. The four victims included in the felony complaints, who range in age from 64 to 83 years old, began investing in the scheme in 2013, according to the statement.

Pursuant to a concurrent investigation by the Financial Industry Regulatory Authority, Inc., Pagartanis was barred from acting as a securities broker April 10, according to FINRA’s website, brokercheck.finra.org. The website lists customer disputes as well as a judgement/lien.

In addition to the criminal charges, a civil lawsuit was filed against Pagartanis May 30 by the U.S. Securities and Exchange Commission, according to Sini’s office.

If convicted, Pagartanis faces a maximum sentence of eight to 25 years in prison on each count of first-degree grand larceny and a maximum sentence of five to 15 years in prison on each count of second-degree grand larceny. Pagartanis is due back in court July 24.

An attempt to reach Pagartanis was unsuccessful. When calling his office, a message played stating the number is not set up to receive messages. The company’s website www.omegaplanning.com is currently offline.

The district attorney’s office is asking if anyone invested money with Pagartanis, or has any information about the defendant, to call 631-853-5602.