Michael Dippolito's Fraud Scheme: Take Investors' Money, Buy Phone Sex
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| Florida Department of Corrections |
| Dippolito is still on probation for the scheme. |
From a Boca Raton apartment, he ran a telemarketing business that preyed on strangers as far away as Ohio, Illinois, and California, convincing them to invest in the booming foreign currency options market of 2001.
Representatives from Dippolito's companies, M.A.D. Financial and C.T.U. Inc., cold-called strangers to make their pitch. The idea was to bet that the exchange rate between, say, the euro
and the dollar, would rise. Investors would buy a contract that allowed them to buy or sell currency during a specific time frame and profit when the exchange rate went up.
The plan was "risk free," company reps told customers according to court documents, because Dippolito's firms had pre-purchased blocks of options contracts, and the contracts had already increased in value. All the investors had to do was buy them, then watch the profits roll in.
At least a dozen customers wired money to Dippolito's corporate bank account in Jacksonville -- some sent $16,000 or $20,000; one man sent $25,000. But the money was never invested in foreign currency.
Instead, Dippolito kept the cash. He splurged on hotel rooms, clothes, and jewelry. He spent more than $6,000 on "pay by the minute chat rooms," including psychic and phone sex hot lines, according to a probable cause affidavit written in May 2002.
According to court documents filed against him, Dippolito's companies collected a total of more than $200,000 in about 11 months. (He was the sole officer and director of both companies.)
By February 2002, customers had started complaining to the Federal Commodity Futures Trading Commission. Investors were told they made a profit, but Dippolito never wired them the money they earned.
A Broward sheriff's detective arrested Dippolito in March 2002, and he later pleaded guilty to charges of organized fraud and unlicensed telemarketing.
He was sentenced to two years in state prison but served only seven months, thanks to the time he'd already spent in jail awaiting trial. He's now on probation until 2032 and has to pay restitution every month to his victims.
Recently, Dippolito told Boynton Beach police that his wife, Dalia, bilked him out of $191,000 intended to pay that restitution.
Stay tuned for more updates about Dippolito's fraud victims. And to read about the paternity suit filed against him, click here.
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