Boston authorities have charged a West Roxbury man and his wife with orchestrating a Ponzi scheme that may have duped its victims out of millions of dollars. A grand jury indicted Steven Palladino and his wife, Lori, on numerous charges including four counts of larceny over $250, three counts of making false entries in corporate books, and three counts of usury, commonly referred to as loan sharking. The Suffolk County District Attorney's office disclosed that Steven Palladino was being charged as a 'common and notorious thief' as a result of his more-than 24 prior larceny convictions. If convicted of the charges, the couple could face decades of prison time.
According to authorities, the couple owned and operated Viking Financial Group ("Viking") along with their 28-year old son. Potential investors were told that Viking profited by making loans that carried exorbitant interest rates. However, Viking made very few loans, and of these loans, many were made in violation of a state statute prohibiting loan interest rates exceeding 20%. Indeed, three of the loans extended in 2007 and 2008 carried interest rates exceeding 60% - resulting in three charges of usury.
The Palladinos attempted to evade suspicion by falsifying company books and records to make it appear as if Viking was making legitimate loans. However, in reality, investor funds were used primarily to sustain a life of luxury for the couple that included Bahamas trips, rent for Steven Palladino's mistress, and hundreds of thousands of dollars in gambling losses. Additionally, nearly $400,000 in investor funds were used to satisfy a condition of Steven Palladino's probation stemming from a 2007 conviction for, ironically enough, defrauding an elderly relative.
While Steven Palladino is scheduled to be arraigned today, Lori Palladino and Viking are not expected to appear in court until April 4, 2013.