Broker charged with securities fraud

March 25, 2009 10:32:08 AM PDT
A 44-year-old Woodside man has been arrested and charged for allegedly aiding and abetting securities fraud, federal authorities announced Tuesday.

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David Scott Cacchione, a managing director at San Francisco-based brokerage firm Merriman Curhan Ford and Co., allegedly aided and abetted Silicon Valley venture capitalist William "Boots" Del Biaggio III, in connection with a scheme to defraud multiple investors in order to obtain and guarantee loans totaling about $100 million, the U.S. Attorney's Office said.

"Clients put their trust in investment professionals to act in the best interest of the client. The integrity of the markets depends on those professionals acting within the law," U.S. Attorney Joseph Russionello said in a prepared statement.

Cacchione allegedly obtained copies of client account statements and turned them over to Del Biaggio, who allegedly falsified the statements to make it appear as if he owned the accounts' securities.

Cacchione is also alleged to have falsified Account Control Agreements to make Del Biaggio appear as the owner of those client accounts, which were later used to apply for and guarantee loans from various individuals and entities.

The U.S. Securities and Exchange Commission filed a separate civil lawsuit against Cacchione.

Cacchione faces a maximum statutory penalty of 25 years in prison and a fine of $250,000 or up to twice the defendant's gain or the victims' loss, including restitution if appropriate.

A date for Cacchione's first court appearance has yet to be set.

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