Money Management Firm Headed By Hamptons Mayor Indicted
Melhado, Flynn & Associates has more than a bear market to contend with. Earlier this year its CEO was indicted by the U.S. Attorney’s office after a long SEC investigation:
August 28th
According to the indictment filed by Assistant U.S. Attorney James McGovern, George Motz, head of the Manhattan investment firm of Melhado, Flynn & Associates, enriched himself and his firm by “cherry-picking,” crediting more profitable stock trades to his firm’s account and the less profitable trades to other customers’ accounts.
When the SEC began investigating Motz’s practices in 2003, Motz, along with others who were not named, illegally altered company records to make it appear as if all the stock trades had been legitimately carried out, according to the indictment.
In one scheme, between November 2002 and September 2003, Motz retroactively credited profitable stock trades to his firm and unprofitable ones to a hedge fund called Third Millennium, the indictment said. The fund’s partners were “primarily high-net-worth individuals,” according to the indictment.
“The fund was marketed to investors based in part on Motz’s track record of success in trading,” the indictment said.
While Motz continues to protest his innocence, and serve as mayor of one of the wealthiest enclaves in Long Island’s Southampton Town, his money management firm has now been indicted as the Feds press their case:
Melhado, Flynn & Associates, the Manhattan-based investment firm headed by Quogue Village Mayor George Motz, has been indicted by the U.S. Attorney’s Office and charged with felony fraud and altering documents in an attempt to impede the subsequent investigation.
The indictment comes several months after Mr. Motz was indicted on the same charges. He pleaded not guilty this past summer and is expected to reappear in court this December....Mr. Motz, who is facing up to 45 years in prison if he is convicted, is scheduled to appear in U.S. District Court in Central Islip for a pre-trial hearing on Friday, December 19, at 4 p.m. A trial date may be set at that time. Attorneys representing the interests of MFA are also scheduled to appear in court at a later date.
Authorities have said that the charges have nothing to do with Mr. Motz’s work as Quogue Mayor, a position he has held since 2002. In past interviews, Mr. Motz, who is married to Village Justice Kittric Motz, has maintained his innocence and has said he has no intention of stepping down from his elected post. 27 East
With East Hampton in severe financial woes it would appear the salad days of the Hamptons are over until the next bull market. And Quogue, home to many of Wall Street’s BSD’s, might have to consider looking for a new Mayor.
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Quogue mayor’s investment firm also indicted on fraud charges
27 East
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