PLEASANTON -- A Pleasanton man was sentenced Friday to six years in prison for defrauding investors out of more than $40 million in a Ponzi scheme that involved more than 300 people and caused many to lose their homes and their entire life savings.

According to the U.S. Department of Justice, Kenneth Kenitzer, 70, of Pleasanton, and Anthony Vassallo, 34, of Folsom, ran a company called Equity Investments Management & Trading, based in Folsom, that promised investors returns of approximately 36 percent a year.

The firm operated from 2006 to 2008 and relied on investors who funneled money into the company through a number of sub-funds. Kenitzer served as the primary point of contact for investors and managers.

Although Kenitzer knew that Vassallo was lying about the returns on investments, he continued to tell investors that EIMT was a profitable venture, according to prosecutors.

The company took in more than $83 million, although some of the money was eventually returned to investors, most of whom lived in the Sacramento area, according to prosecutors. The scheme began to unravel in late 2008, and investors began demanding that the company return their money, the Justice Department said.

Vassallo and Kenitzer engaged in stalling tactics, saying they were "restructuring" the funds or that the SEC had frozen company accounts due to a baseless complaint. Even as some customers began to doubt the investment company, EIMT continued to aggressively pursue new investments.


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In one case, an investor transferred $250,000 to the company less than two weeks before Vassallo admitted to a group of investors that he had ceased trading and their money had been lost.

Vassallo is currently serving a 16-year prison sentence.

Contact Karina Ioffee at 650-576-9626. Follow her at Twitter.com/kioffee.



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