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Joseph Cimino, founding father of 6 Diploma Tequila, has pleaded responsible to safety and wire fraud after he misused investor cash and falsely inflated his firm’s gross sales.
The US Legal professional’s Workplace for the Southern District of New York announced in February 2021 that it had arrested Cimino and charged him with one rely of safety fraud and one rely of wire fraud because of his ‘fraudulent solicitation of investments’ for six Diploma Tequila.
Earlier this week (15 November), the 57-year-old businessman pleaded responsible to each counts, which every carry a most of 20 years in jail.
US lawyer Damian Williams stated: “As he admitted in courtroom at the moment, Joseph Cimino lied about his Tequila enterprise’ funds to lure buyers after which diverted investor funds in an effort to line his personal pockets. Now Cimino awaits sentencing for his fraudulent conduct.”
In line with courtroom paperwork and statements in courtroom, Cimino raised roughly US$935,000 from a minimum of 25 buyers to fund his Tequila firm from 2014 to 2018.
Nonetheless, Cimino was discovered to have falsely inflated the quantity of capital he had raised from earlier buyers and claimed a number of people had invested within the agency after they had not.
Moreover, Cimino was accused of falsely inflating the Tequila firm’s gross sales in a variety of investor communications.
Throughout 2014 to 2018, Cimino transferred roughly US$472,000 of investor cash from the Tequila firm into his private checking account, which was used to fund his residing bills, meals and leisure.
In October 2017, Cimino is assumed to have stated gross sales reached 6,035 instances, however in actuality it solely made up 20% of that quantity. That very same month, he advised buyers the agency would obtain compensation for 800 instances of Tequila that have been allegedly destroyed at a distributor’s warehouse in Puerto Rico because of Hurricane Maria. However the Tequila agency had no insurance coverage and none of its stock had been destroyed within the hurricane.
Cimino is because of be sentenced in courtroom on 18 February 2022.
The Spirits Enterprise has approached 6 Diploma Tequila for remark.