MIAMI - David Joseph Varrone, 56, and wife Sherry Varrone of Weston, Fla., have been charged in federal court with conspiring to commit wire fraud through an elaborate credit “leasing" and investment Ponzi scheme linked to their company, The Credit Engineers Inc.
According to allegations in separately filed Informations, from 2018 through 2021, the Varrones offered individuals with good credit a short-term “Credit Leasing" investment program tied to a purported hedge fund that would yield a guaranteed return on investments plus fully repay the loans within 36 months or less. The Varrones and their co-conspirators helped victims apply for the high interest, short term loans and the victims “leased" the proceeds to The Credit Engineers and David Varrone. However, there was no hedge fund and victims’ funds never were invested. Instead, the proceeds were used to enrich the Varrones and to pay back earlier victims-i.e., a Ponzi scheme. In total, the scheme funneled over $6.4 million of misappropriated victims’ funds into the Varrones’ accounts. Additionally, David Varrone fraudulently applied for and received approximately $650,000 in C.A.R.E.S. Act, Economic Injury Disaster Relief Loans from the U.S. Small Business Administration (SBA). These loans are intended to keep small businesses afloat and retain employees.
David Varrone was arraigned Tuesday and Sherry was arraigned today. If convicted, David Varrone faces a maximum penalty of 30 years in prison and Sherry Varrone faces a maximum penalty 0f 5 years in prison. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines along with other mitigating, aggravating, and statutory factors.
Juan Antonio Gonzalez, U.S. Attorney for the Southern District of Florida, and Russell C. Weigel III, Commissioner of Florida’s Office of Financial Regulation (OFR), made the announcement.
OFR investigated the case, with assistance from the U.S. Secret Service. Assistant U.S. Attorney Trevor Jones is prosecuting the case. Assistant U.S. Attorney Emily Stone is handling asset forfeiture.
An information is a charging instrument containing allegations. A defendant is presumed innocent unless and until proven guilty in a court of law.
Related court documents and information may be found on the website of the District Court for the Southern District of Florida at www.flsd.uscourts.gov or at http://pacer.flsd.uscourts.gov, under case numbers 22-cr-60197 and 22-cr-60196.
Source: U.S. Department of Justice, Office of the United States Attorneys
