OWNER OF AVON FINANCIAL FIRM SENTENCED TO 7 YEARS IN FEDERAL PRISON FOR STEALING $4.5 MILLION FROM INVESTORS

Kevin J. O’Connor, United States Attorney for the District of Connecticut, announced that DAVID M. FAUBERT, age 50, of Simsbury, Connecticut, was sentenced today by Senior United States District Judge Ellen Bree Burns in New Haven, to 84 months of imprisonment, followed by three years of supervised release, for stealing millions from clients of his investments company. On November 14, 2006, FAUBERT waived indictment and pleaded guilty to 10 counts of mail fraud, one count of embezzlement from an employee benefit plan, and four counts of filing false tax returns.

According to documents filed with the Court and statements made in court, FAUBERT, a registered agent for certain broker dealers and investment advisors, owned and controlled a company called Faubert Investment Group, Inc. (FFG), of Avon, Connecticut. Through FFG, FAUBERT provided insurance and other financial services to approximately 225 clients. Between approximately January 2000 and April 2005, FAUBERT, represented to certain existing clients that he would guarantee them an 8% rate of return if the clients invested money in a fixed investment account controlled by him. As a result of FAUBERT’s promises, 21 clients provided FAUBERT with approximately $5,497,918. However, the fixed investment account did not exist, and FAUBERT deposited the monies directly into his business and personal accounts.

As part of the scheme, FAUBERT spent approximately $4.5 million for his own personal use and enjoyment, which included gambling, lavish vacations, and expensive cars. In order to lull the investors into believing that the investments were earning the promised rate of return, FAUBERT mailed false monthly financial statements to his clients.

“The lengthy term of imprisonment imposed today is appropriate for an individual who stole millions from trusting clients, many of whom were elderly and lost most of what they spent their lives saving, simply to support a lavish and decadent lifestyle,” U.S. Attorney O’Connor stated. “Those with gambling or drug addictions are encouraged to seek counseling before resorting to such unconscionable acts.”

In addition, FAUBERT embezzled $27,079 from FFG’s retirement plan by falsely representing to two employees that the money had been withheld from their paychecks and invested in the retirement plan. FAUBERT used the $27,079 to cover personal expenses.

Finally, FAUBERT filed false income tax returns for the years 2000 through 2003 because he failed to report the funds he embezzled from the investment clients, resulting in a tax loss to the Government of $946,155.

.CONTACT:

U.S. ATTORNEY'S OFFICE
Tom Carson
(203) 821-3722
thomas.carson@usdoj.gov