A New Jersey man, who after his arrest for a $20 million Ponzi scheme subsequently robbed a Florida bank by brandishing a fake bomb, has pleaded guilty to a wire fraud charge in connection with the scheme. Louis Spina, 57, entered his guilty plea today before U.S. District Judge Anne E. Thompson. Spina could face a maximum of twenty years in federal prison when he is sentenced, as well as criminal fines and restitution.
Spina's story reads like a gripping Hollywood thriller. With only a high school diploma, Spina started working for the New York Stock Exchange at the age of 19. Spina apparently had a penchant for Wall Street, becoming an NYSE member at age 27 and taking home at least $800,000 in annual pay during an 18-year period beginning in 1983. Spina, who apparently had a knack for being captured by media outlets on the trading floor (see here, here, and here), ultimately spent over 25 years on Wall Street.
In 2010, Spina left Wall Street and formed LJS Trading, LLC ("LJS"). Potential investors were told that Spina could deliver annual returns ranging from 9% to 14% through trading in various stocks and equities, wit the understanding that Spina would be entitled to keep any surplus profits. Spina would ultimately raise approximately $20 million from dozens of investors.
However, Spina ultimately used less than 50% of investor funds for their stated purpose, and indeed lost the entirety of the $9.5 million he invested. He spent the remainder of investor funds to sustain a lavish lifestyle that included expensive cars, luxury real estate, and even a $400,000 donation to a private university.
When investors began questioning Spina about the safety of their funds, Spina provided them with "screenshots" of his trading account displaying a large balance. According to the FBI, this balance was not the accurate balance, but simply a display of the 100-to-1 margin purchasing power used by Spina. In late 2013, Spina told investors that he was in talks to sell the company to an unnamed wealthy individual that could offer even higher annual returns of 14% to 30% - and succeeded in raising an additional nearly $2 million.
However, there was no wealthy benefactor waiting in the wings, and Spina was arrested in November 2013 on federal charges that he was operating a Ponzi scheme. Several months after his arrest, Spina entered a Wells Fargo branch in Coral Gables, Florida, wearing a black ski mask over his head and carrying a bag which he claimed contained a live bomb. Spina made off with approximately $16,000 from the heist, but a witness observed his getaway and reported his plates to authorities. Spina was arrested without incident the following day, where he confessed to authorities that he had robbed the bank, used a key fob to simulate a detonator, and used most of the robbery proceeds to pay bills. Spina was recently sentenced to a 41-month prison sentence for the robbery.
Spina now faces an additional prison term of up to twenty years for the wire fraud charge. Sentencing is currently scheduled for February 26, 2015.