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Dix Hills Man Indicted on Fraud Charges; Feds Allege Scheme to Buy Shinnecock Cigarettes

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By Tessa Raebeck

A Dix Hills man was arraigned in federal court Tuesday following charges that he solicited over $5 million from friends and neighbors in what federal officials are referring to as a Ponzi scheme that took place over eight years.

Robert Rocco, 48, was charged with 14 federal counts of wire and mail fraud, after allegedly promising investors returns of as much as 18 percent annually on fabricated investments, according to an indictment unsealed Tuesday.

Prosecutors said victims believed their investments – ranging from $25,000 to $1.2 million – were being used by Rocco to fund loans to a tobacco shop on the Shinnecock Native American Reservation to finance wholesale cigarette purchases, among other ventures.

Since 2006, Rocco purported to provide said financing through his corporation, Limestone Capital Services (Limestone) in Melville, in which over two dozen individuals invested, according to prosecutors.

As president of the Dix Hills Soccer Club, Rocco allegedly used his position to solicit donations and investments from members, donors and volunteers of the club. The indictment states he controlled the club’s bank accounts and did not permit others to access the records.

In early 2010, Rocco allegedly took some $66,915 from the Dix Hills Soccer Club and deposited the checks into a Limestone bank account, subsequently distributing the funds to his investors as their purported returns.

According to the indictment, Rocco then told one victim, who is a volunteer and member of the soccer club, that the club had no funds left, prompting the victim to make two donations of $20,000 and $25,000, respectively.

In the summer of 2010, Rocco allegedly solicited donations from the victim and his family for a new company, Advent Merchant Services, LLC, (AMS) which he said was a credit card processing company. The indictment states the money Rocco received from the victim for AMS was not invested, but instead used to pay purported returns to Limestone investors.

Prosecutors said Rocco again solicited the victim for donations to a third company, Advent Equity Partners, LLC, (AEP) and provided him with fraudulent notarized sale contracts and bank statements. In addition to the $45,000 in donations meant for the Dix Hills Soccer Club, the victim and his family paid Rocco over $1.3 million for supposed investments in AMS and AEP, said the indictment. Rocco allegedly used the victim’s own funds to pay the family’s returns.

According to the indictment, Rocco recruited a second victim – who also invested his money as well as his family’s money – to help him solicit investments from a wider network of friends, family and colleagues. Prosecutors said Rocco promised investors annual rates of return of 15 to 18 percent and raised over $5 million in investments in Limestone alone between 2006 and 2013.

Using funds received from later investors, Rocco allegedly paid initial investors about 10 checks of a few hundred dollars per year between 2009 and 2013, with lesser returns than promised.

Around February 2009, Rocco told Limestone investors that some $5 million in uninsured cigarette inventory financed by the company was stolen from the Shinnecock Reservation by “a rival Indian tribe,” according to the indictment. No police report was filed.

In the late summer of 2013, after allegedly missing payments to investors, Rocco reportedly confessed to the second victim – who had helped him solicit investments – that everything he had told him about Limestone was a lie.

Rocco is charged with five counts of wire fraud and nine counts of mail fraud, all federal. He reportedly pled not guilty to all charges.

If convicted, Rocco faces substantial jail time – as much as 30 years per charge – and must forfeit all funds and property obtained directly or indirectly as a result of his alleged offenses, including his home in Dix Hills.