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CT Man Accused Of Defrauding Investors

New Haven County man arrested for allegedly defrauding investors.
New Haven County man arrested for allegedly defrauding investors. Photo Credit: Pixabay/NikolayFrolochkin

A Connecticut man has been indicted on 17 counts of allegedly defrauding investors of an alcoholic beverage company.

Brian Hughes, 56, of Madison, was indicted on Friday, Jan. 15, following his arrest, said John H. Durham, U.S. Attorney for the District of Connecticut.

The indictment alleges that in March 2015, Hughes founded Handcrafted Brands, for the purpose of raising money to purchase Salute American Vodka, an alcoholic beverage company. 

After founding the company, Hughes allegedly solicited and received funds from investors for the purchase and development of Salute. 

 Hughes represented to investors that their investments would be used to purchase and operate Salute, that investors would be compensated with equity shares of HCB or Salute, and that Hughes would not take a salary from HCB, the indictment said. 

 In fact, Hughes misused investor funds on expenses unrelated to the purchase and development of Salute and diverted hundreds of thousands of dollars of investor funds for his personal use. In addition, some victim investors were not compensated with equity shares of HCB or Salute, the U.S. Attorney's Office said.

The indictment also alleges that Hughes solicited investments on behalf of another company, and also falsely saying he owned that company when he did not.

As in the first case, Huge allegedly again used the money for personal expenses unrelated to the company.

The indictment also says that Hughes evaded the assessment of his tax obligations for 2015 through 2018 tax years by substantially underreporting his income to the IRS.

Huges was charged with seven counts of wire fraud; five counts of illegal monetary transactions; one count of money laundering, and four counts of tax evasion.

He is being detained pending his next hearing on Thursday, Jan. 21.

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