New Canaan Man, Former Madoff Employee, Charged by State

State officials say a New Canaan man and former Madoff employee
violated Connecticut banking laws through a complicated scheme that saw
millions invested in multiple funds not properly registered while he
took a percentage fee and misled investigators.

The Connecticut
State Banking Commission has issued a Cease-and-Desist against Gregory
Richard Imbruce and charged him with fraud, according to the notice to
cease and desist as well as a notice of intent to fine. Bruce faces up
to $100,000 per violation.

The documents charged Imbruce with
forming a number of Limited Partnerships and Limited Liability
Companies, based out of the same office in a Stamford suite, then using a
number of those companies to invest in oil and natural gas properties
in Oklahoma and Texas. Imbruce allegedly listed a number of
"alter-egos"—under company names such as Asym, Hunton and Giddings
Genpar—as leaders of the company, but is charged with using these names
as placeholders for companies in which Imbruce was in sole control, in
exclusion of all other parties. He ultimately used these companies to
garner capital contributions from 42 limited partners totaling $14.5
million.

He also failed to disclose to investors that he had been
sanctioned by a governing body in the banking industry for his
involvement with Madoff, and misled state officials, the cease and
desist letter says.

The activity took place over three separate periods between September 2009 and December 2012, the state says.

A
number of the investors, including a pair from New Canaan, have brought
a civil suit against Imbruce for these charges, officials say. Attorney
Jon Whitcomb, partner at Stamford's Diserio, Martin, O'Connor &
Castiglioni, LLP, and listed as representation for some of the parties
in the civil suit, said the charges from the state validate the civil
case against Imbruce.

"This confirms the allegations in our civil
lawsuit," said Whitcomb. "We are not surprised. This is an individual
who worked under Bernie Madoff, had an adverse [Financial Industry
Regulatory Authority] ruling against him and a history of lawsuits being
bought against him. The vast majority of these current investors,
either directly or indirectly, are suing him right now."

Imbrice
was not immediately available for comment. Hehas two weeks to respond
to the allegations, brought in a document dated Dec. 17 and signed by
prosecuting attorney Elena Zweifler. The state identifies Imbruce's
address as 131 Thurton Drive. New Canaan
tax records show that the property, appraised at $1.47 million, has been
owned for nearly 20 years by another party.
The state charges
that Imbruce never invested in his own companies though he represented
to his partners that he had in order to sell them on the idea of
investing themselves, and sold to these investors units of the companies
while they remained unregistered in Connecticut, though he represented
that the companies had been properly registered. Of the companies that
were registered, he failed to notify the state of the sales prior to the
notice fling deadline, officials say. None of Imbruce's "alter-egos"
were registered investment advisors, as per state law. Investors faced
further complications when Imbruce failed to provide documentation that
would allow them to properly file federal and state income taxes.
Similarly, the state charges that Imbruce failed to provide them with
documentation they've requested in connection to the case.

Imbruce
also is accused of failing to disclose a number of facts to the
investors, including that he had worked under Madoff at all, listing
only that he had worked in a "family office," on his resume, sources
involved with the suit said. He also failed to disclose to his limited
partners that the FINRA had instituted a regulatory action against him
while he was employed with Madoff Securities and was found to have
violated the Exchange Act while there, ultimately leading to his
suspension from working in the securities industry for 10 days and a
total of $8,903.70 in liens and fines levied against him.

This
Cease-and-Desist means Imbruce can not act as a financial advisor unless
he is registered in the State of Connecticut. If found guilty, he may
never be able to act as an advisor again.