Rockland Man Targeted Haitians In 'Callous' $2 Million Fraud

NANUET, NY — A Nanuet resident defrauded people in the Haitian community of more than $2 million in a multi-year securities fraud that started with a day-trading Ponzi scheme and ended with a fast-food franchise scam.

He also embezzled money from his employer in Rockland and Westchester, said Audrey Strauss, the United States Attorney for the Southern District of New York.

Ruless Pierre, 51, was convicted Thursday in Manhattan federal court of securities fraud, wire fraud, and structuring charges after a trial before Judge Sidney Stein.

Strauss said Pierre 'callously' lied to investors for years, and targeted the Haitian community.

"He told investors their investment returns were excellent, when in fact he failed to invest investor funds as promised, generated losses when he did invest, and diverted much of investor funds to his personal use and to repay investors in a Ponzi-like fashion," Strauss said in an announcement.

From at least November 2016 through October 2019, Pierre solicited money from investors by falsely promising them that Ruless Pierre Consulting Group would earn a 20 percent return on their initial investment every 60 days through stock trading. The contracts also promised that the investor could withdraw all funds from the investment with 30 days’ notice.

During the course of the investment fraud scheme, Pierre fraudulently obtained over $2 million from nearly 100 investors.

After receiving money from investors, Pierre deposited the money into one of his personal bank accounts or bank accounts of RPCG. He then transferred the money to trading accounts, where he engaged in unprofitable day trading.

Despite his trading losses, he repeatedly told investors, including in statements containing fictitious balances, that the trading was profitable and that their investments were growing as promised.

In addition to losing their money, he also used their funds to pay for personal expenses, including luxury vehicles. Additionally, he further concealed the truth by using money obtained from new investors to make redemption payments to previous investors, in Ponzi-like fashion, Strauss said.

Beginning in November 2018, Pierre began to offer investors, including some who were invested in his Promissory Note Fraud, the opportunity to purchase partnership interests in a partnership that would run three fast-food franchise locations.

At the time, he did not own any of the fast-food franchises, but he was in discussions regarding purchasing them.

Pierre received financial statements for the franchise locations, which showed minimal profits.

Each victim received a document entitled “Silent Partnership Agreement.” It promised the investors a 5 percent monthly return on the investment, in addition to a 40 percent pro rata share of the quarterly gross operating profit. The minimum investment was $5,000.

The Silent Partnership Agreements further provided that Pierre was responsible “for the complete management, control, and policies related to the operation and conduct of the business.”

In April 2019, Pierre purchased one fast food franchise for roughly $50,000. He did not purchase the other franchises.

He deposited the fast-food franchise investors’ money in bank accounts which commingled the funds from the Franchise Investment Fraud with the Promissory Note Fraud. In Ponzi-like fashion, he fraudulently misappropriated some of the fast-food franchise investors’ money to pay back investors in the Promissory Note Fraud, Strauss said.

He raised at least $200,000 by selling the Silent Partnership Agreements to at least 18 investors. Some of the investors were paid their 5 percent monthly distribution, but the vast majority of the investors were not made whole. The fast-food franchise went out of business in December 2019.

In another scheme, Pierre embezzled money from his former employers. From 2007 until February 2016, he was the director of finance for two different hotels owned by the same company. One hotel was located in the Palisades, while the other was located in Armonk.

As the director of finance, Pierre was the signatory on several bank accounts held in the name of the management companies that managed the hotels.

After August 2018, Pierre no longer worked at either hotel, but regularly wrote himself checks payable to cash from the management companies’ bank accounts. Specifically, from September 2018 through March 2019, Pierre wrote more than 70 checks to “cash” or “petty cash” from one of the bank accounts for the hotel in Palisades, for over $300,000.

In addition, from March 2017 through 2019, he deposited large amounts of cash into his personal bank accounts in amounts that were generally less than $10,000. The deposits were conducted at various bank locations and typically took place on the same day, consecutive days, or within a short period of time. For example, in just seven months, from June 2018 through December 2018, he deposited $225,612, through 138 cash deposits all under $10,000, into a bank account in the name of RPCG.

Pierre was convicted of two counts of securities fraud, each of which carries a maximum sentence of 20 years in prison, one count of wire fraud, which carries a maximum sentence of 20 years in prison, and one count of structuring, which carries a maximum sentence of five years in prison. The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

He is scheduled to be sentenced Sept. 9, 2021.