Supreme Court will hear disgraced ex-banker’s securities fraud case
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Disgraced former investment banker Francis Lorenzo — who in high school was caught stealing a salami sandwich from a convenience store — won the right on Monday to have the Supreme Court hear his 2015 securities fraud case.
If Lorenzo is successful, the high court could narrow regulators’ ability to bring securities fraud cases on Wall Street.
The Securities and Exchange Commission in 2015 banned Lorenzo from the securities industry for life after it was found that six years earlier he sent two emails to clients containing misleading information about the financial health of energy company Waste2Energy.
Lorenzo, 56, claims his bosses at brokerage Charles Vista had given him the false information, and he was just passing it along — making him not primarily liable for the wrongdoing.
Lorenzo claims the SEC improperly punished him because it wrongly fingered him for writing the emails.
A federal appeals court in 2017 upheld the SEC’s finding that “the statements in Lorenzo’s e-mails were false or misleading and that he possessed the requisite intent.”
“To be primarily liable for a false statement, you had to be able to control the publication of the statement, or the distribution of the statement,” Thomas O. Gorman, with Dorsey & Whitney, told The Post.
The appeals court did find in Lorenzo’s favor that the banker did not “make” the false statements — giving him an opening for an appeal.
Lorenzo has worked at 16 firms since 1988. Perhaps the oddest entry on in his Finra broker record is the case of the stolen salami sandwich.
Lorenzo was caught taking the sandwich during a high school ski trip.
“Frank Lorenzo attended a school ski trip. During the trip he visited a convenience store where he stole a salami sandwich,” according to a summary of the incident.
Lorenzo was charged with petty larceny at the time, but a judge later dropped the charges, according to the report. He could not be reached for comment.
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