A financial adviser from New Hyde Park was charged Monday with wire fraud after allegedly running a $300,000 Ponzi scheme to repay losses from unauthorized trading in client accounts.
Paul Sullivan, 47, hatched the scheme to divert money from new clients' accounts to pay off trading losses that dated back to 2005, officials said, and was secretly videotaped by one of his victimized clients admitting to the fraud, officials said.
"I panicked, then it just snowballed and it snowballed and it snowballed, and it just kept going," he said, according to a criminal complaint filed in federal court in Brooklyn. "And now, I'm so far behind that I can't get out from under."
Altogether, Sullivan is accused of ripping off seven different clients over three years to pay back previous investors. Several of them attended his appearance before a magistrate Monday afternoon.
They declined to give their names, but said Sullivan had been a friend who used personal ties to convince them to invest with him.
Sullivan was released on $400,000 bail secured by his mother's house and his wife's house, which court officials said was transferred into her name a year ago. He did not enter a plea, and declined to comment after leaving court.