United States Attorney
Northern District of New York
Thursday, October 27, 2011
Christopher Bass Sentenced in New York to More Than 12 Years in Prison for Orchestratng Ponzi-style Fraud Scheme
Ordered to Pay More Than $5.3 Million in Restitution to Hundreds of Victims
ALBANY – Christopher Bass was sentenced today by Senior U.S. District Judge Lawrence E. Kahn to 151 months in prison, to be followed by a period of three years supervised release, and was ordered to pay restitution in the amount of $5,308,340 to the victims of his Ponzi-style scheme involving entities formerly known as Swiss Capital Harbor.
The sentence was announced by U.S. Attorney Richard S. Hartunian of the Northern District of New York; James C. Spero, Special Agent in Charge, Homeland Security Investigations; Charles R. Pine, Special Agent in Charge, Internal Revenue Service-Criminal Investigation (IRS-CI); William Leege, Resident Agent in Charge, U.S. Secret Service; and Clifford C. Holly, Special Agent in Charge, FBI.
Bass has been in custody since his initial arrest in the case on Feb. 8, 2010, and was remanded today following sentencing.
Bass, 54, formerly of Troy and Menands, N.Y., admitted at the time of his plea that he relocated from Europe to Albany County in or about May 2006 and, thereafter, from approximately Jan. 1, 2007, through Feb. 1, 2010, he promoted, managed and directed a fraudulent investment program involving the purchase and sale of securities to investors in the Capital Region and elsewhere. From January through August 2007, the fraudulent investment program operated under the name Revisco Finanz AG and from August through December 2007, it operated under the names Revisco Finance USA and Revisco Finanz AG. Thereafter, from approximately December 2007 through Feb. 1, 2010, Bass conducted the fraudulent investment program using the name Swiss Capital Harbor/USA LLC and other variations utilizing the name Swiss Capital Harbor.
At the time of his guilty plea last year, Bass admitted having solicited and accepted a total of more than $5.5 million from more than 250 investors. At sentencing today, the government indicated that additional investigation confirmed the total deposits were more than $6.7 million from approximately 400 victims, more than 300 of whom suffered monetary loss as a result of their investments in the scheme. While Bass promised these victims that their funds would be sent to Europe for investment, the majority of the investor deposits were (1) disbursed to Bass or used to pay for his personal expenses, (2) used to repay investors who demanded a return of their initial investment or distribution of the income allegedly earned, as is common in such Ponzi-style schemes, and (3) used to pay for expenses incurred in operating the fraudulent investment program.
Bass further admitted at the time of his plea that, as part of his scheme, he caused periodic account statements to be issued that reported monthly returns and account balances that were false and grossly overstated, and that he made numerous additional false statements to prospective and actual investors, including that their investments were insured, risk free or protected by a cash reserve account. At this point, no funds have been recovered to be applied toward the victims' losses.
In addition to his plea to one count of wire fraud involving the fraudulent investment program, Bass also pleaded guilty to attempted evasion of taxes in connection with the Form 1040, U.S. Individual Income Tax Return that he filed for himself and his spouse for 2007, in which he falsely reported the amount of income that he received from operation of the fraudulent investment program. In substance, Bass received gross income of at least $220,000 from the fraudulent investment program in 2007 with taxable income of at least $145,936, whereas he falsely reported only $114,732 in gross income and taxable income of $49,507, resulting in a substantial income tax due and owing for 2007 of at least $34,445. Bass was sentenced today to the statutory maximum of 60 months on the income tax count, to run concurrently with the sentence on his wire fraud conviction, for a total sentence of 151 months in prison.
A number of victim investors attended the sentencing proceeding, and five spoke to the court about the financial and personal devastation suffered by them and their families as a result of Bass' scheme. The victims who spoke were representative of many who lost their retirement and other life savings, and had their life plans drastically altered by losses suffered as a result of their reliance on Bass and his promises.
U.S. Attorney Hartunian stated: "The significant incarceration sentence handed down by the court today reflects the severe impact of investment fraud on the hard-working men and women who work and live in this community. Hundreds of people trusted Christopher Bass with their financial futures, and he greedily abused that trust and left in its place a swath of financial ruin. This office, working closely with our federal law enforcement partners, is committed to combating such heinous crimes, and bringing perpetrators such as Christopher Bass to justice."
The case was investigated by the Albany Offices of Homeland Security Investigations, IRS-CI and the U.S. Secret Service, with the assistance of the Albany Division of the FBI, and was prosecuted by the U.S. Attorney's Office for the Northern District of New York.
This case is part of efforts underway by President Barack Obama's Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information on the task force, visit www.StopFraud.gov.