Ex-rep sentenced, daughter indicted as victims detail $11M Ponzi scam
With his Ponzi scheme of some two decades beginning to unravel, ex-Securities America advisor Hector May warned his closest friends that they needed to move assets into bonds.
“He felt we were due for a correction in the stock market and bonds would be more secure,” according to an excerpt from a victim statement, which federal prosecutors included in a sentencing memo submitted last month after May, 78, pleaded guilty to fraud.
“He would tell me not to worry because he treated our money like it was his own,” according to the ex-client’s statement. “He stole my belief in the essential goodness of the human spirit. His BETRAYAL stole my faith, my trust, my security, my joy and gratitude of each day.”
In a sentencing memo submitted by his lawyer, May admitted that he “lived a lie” while defrauding and deceiving “people he considered friends and family.” However, May asked for a lighter sentence based on factors including his advanced age and the fact that it was his first offense.
U.S. District Judge Vincent Briccetti imposed a federal prison sentence that was two years shorter than the low end of prosecutors’ guidelines but three years longer than probation officials’ recommendation. Calling May’s conduct “appalling, reprehensible and evil,” Briccetti sentenced him to 13 years and ordered him to pay $8 million in restitution.
A day earlier, a grand jury in the Southern District of New York indicted May’s daughter, Vania May Bell, on fraud charges. Securities America, May and Bell also face a civil lawsuit filed by ex-clients seeking $18 million in damages.
May’s “multimillion-dollar Ponzi scheme” displayed “extreme cunning, ruthlessness and utter disregard for the well-being of his victims, including aging couples, close friends, relatives and an employment pension plan,” U.S. Attorney Geoffrey Berman said in a statement.
An attorney representing May in the criminal case did not respond to requests for comment.
May didn’t ask for sympathy and “nor does he believe he deserves it,” according to the defense’s memo, which attributed his conduct to bad judgement, lack of planning expertise and “general insecurities” about his practice and status in his Rockland County community.
The memo stated, however, that “Mr. May never set out to defraud his clients. It was never a long-contemplated plan to scheme and steal from hardworking people who were awesome, his friends.”
Ladenburg Thalmann’s Securities America has already paid out nearly $4.4 million to former clients who settled their arbitration claims against May last year, according to FINRA BrokerCheck. Securities America is “seeking to resolve” the lawsuit, Ladenburg’s stated in its first-quarter earnings.
In an email, representatives for the Omaha, Nebraska-based independent broker-dealer declined to comment, citing company policies against discussing legal and regulatory matters, along with individuals who are not affiliated with the firm.
The Ladenburg IBD failed to spot the red flags of a barred ex-advisor who later pleaded guilty to fraud, former clients say.April 3
Former Securities America rep Hector May carried out a 20-year scam through his outside RIA, according to prosecutorsDecember 17
A FINRA arbitration claim followed an asset freeze and the launch of a federal investigation into the fired advisor’s RIA.June 27
In March, Securities America filed a motion to compel arbitration in the civil case filed the previous month by Judith and Robert Jamieson. The firm says the clients agreed to pursue any claims in arbitration, but the plaintiffs say Securities America has failed to show they did so.
Lawyers for the the Jamiesons declined to discuss the case, on which a decision by Judge Briccetti on the firm’s motion to compel arbitration in the separate civil lawsuit is pending. In July, Briccetti denied the Jamiesons’ motion to depose May, ruling he could be deposed after the criminal case.
May’s daughter pleaded not guilty to charges of wire fraud, and conspiracy to commit wire fraud, at her Aug. 1 arraignment. In an April filing in the civil case, Bell said she was not involved with the scheme. She didn’t respond to an email.
“I did not ever conspire, assist, conceal, deceive and, most importantly, did not economically gain benefits in any and all of these written allegations,” Bell, 54, wrote in the formal answer filing, in which she referred to her father and former employer as “Mr. May.”
The indictment, which refers to Securities America as “Broker Dealer-1,” says Bell served since 1993 in roles such as comptroller and compliance specialist of May’s New City-based RIA. Investigators allege that Bell created false account statements and kept records of the asset flows.
May obtained more than $11 million from 16 different groups of victims while causing at least $8 million in losses, the prosecutors’ sentencing memo states. He convinced victims to invest in phony bond funds through his RIA, Executive Compensation Planners, prosecutors say.
“Each time May chose to spend his victims’ funds out of ECP’s custodial and operating accounts — whether to buy furs and jewelry for his wife, make political contributions, pay his country club dues, retain a limousine driver, travel, engage in home remodeling, or simply to give money to his family and others — he had to make yet another separate, conscious choice to steal from his victims,” the sentencing memo says. “And he made that choice repeatedly, hundreds of times over the course of about 20 years, stopping only when he was caught.”
The case began in March 2018 after one of May’s clients moved to another BD, which informed the client that her family’s accounts held little to no assets, according to the memo. Securities America performed an unannounced audit of May’s RIA and fired him that month.
Federal investigators also obtained and executed a search warrant. May met with them, consented to additional searches and pleaded guilty that December. The government included statements from several clients in its sentencing memo.
One client suffered a debilitating stroke in 2015. May proceeded to steal $175,000 — on top of the millions already stolen — while recommending the client and his wife take out a home equity line of credit rather than removing any assets from the bond funds, according to prosecutors.
May also misappropriated $1.5 million from pension plans covering at least a dozen employees, investigators say. Another client who owns a restaurant told prosecutors that May and his wife dined weekly while placing the bill on a house account they never paid.
“We go over and over it and still cannot believe how many years he had been living a double life,” the former client said in a victim impact statement. “We have lost sleep over this and feel so violated.”
Deputy County Executive J. Guillermo Rosa and Rockland County Business Association CEO Al Samuels submitted letters of support for May, according to The Journal News. At the July 30 sentencing hearing, though, the Jamiesons and other victims, including Maria Pastana, told their stories.
“This demon preyed on unsuspecting innocent people who put their trust in him," Pastana said, according to the newspaper. "He knew our parents had invested their entire life savings, and knew how hard our parents worked saving every dollar with blood, sweat, and tears.”
Regarding May’s daughter, prosecutors requested a date in late September for an initial conference session in court. Briccetti is expected to rule soon on Securities America’s motion to compel arbitration in the separate civil lawsuit.
In his sentencing memo, May listed some $888,000 in assets he has liquidated — including $189,000 worth of jewelry and furs seized by U.S. Marshals in May. He also offered to provide his entire $3,000 monthly social security payments and $1,500 per month out of his pension toward restitution.
“Mr. May understands that he will never be able to repay all the money he has stolen,” his sentencing memo says. “Although it undoubtedly falls short of the total, Mr. May hopes these extra efforts will alleviate some of the unimaginable pain he has caused his victims.”