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Michael Salerno, 55, was sentenced on Monday, Aug. 26 to three years and one month in prison, U.S. Attorney for the Eastern District of Pennsylvania Jacqueline Romero said in a news release. He had pleaded guilty to three counts of wire fraud after he was indicted for schemes in September 2020 and February 2023.
Salerno operated Black Diamond Forex, L.P., BDF Trading, L.P., Advanta Capital Markets, Inc., and Advanta FX between September 2016 and at least November 2018. The businesses claimed to be used for trading foreign currencies.
Investigators said Salerno used "a variety of misrepresentations and omission" to get his victims to pay advance fees, typically more than $1,000, to hire his company.
"He told the victims that, upon their hiring, he would make available to them a pool of $10 million that they could trade on the foreign currency market and take a generous cut of any profits," Romero said. "Each of these representations was false."
Salerno exaggerated his financial success to appear legitimate. He lied about having a $10 million "real estate empire" that he sold to fund his currency trading business.
Salerno had filed for bankruptcy twice, most recently in 2015, and has been evicted several times for failing to pay rent on his homes. He also was sentenced to 21 months in prison after pleading guilty to federal tax charges in 2005.
Salerno didn't disclose his financial crimes or other issues to his victims and pocketed more than $300,000 in advance fees.
"Under the guise of a businessman, Salerno was truly a criminal, devising schemes built on manipulation and lies, which placed the financial security of his victims at risk," said Wayne Jacobs, Special Agent in Charge of the FBI's office in Philadelphia. "The FBI will continue to rigorously pursue those who attempt to enrich themselves through fraudulent means."
Salerno's currency-trading scheme stopped when he found out he was the target of an FBI investigation. The Commodity Futures Trading Commission got an injunction against Salerno and his businesses in 2018.
Despite the probe, Salerno ran another fraudulent business called AccuOne Financial, Inc. between May 2018 and at least December 2019. The company claimed to help clients with unwanted automobile leases.
AccuOne Financial also claimed to help other clients whose personal credit made it hard for them to get auto leases, vehicle loans, and credit repair services. Salerno took the unwanted vehicles, made very few required lease payments, and flipped the vehicles to the clients who couldn't get their own leases in exchange for high monthly fees.
Salerno profited several hundred thousand dollars in the "house of cards-style scheme" as some clients continued making monthly payments for unwanted cars or suffered significant credit damage, while others had their cars repossessed without warning.
"Michael Salerno is a modern-day snake oil salesman," said Romero. "Upon learning that his fraud scheme had caught the FBI’s attention, he didn’t close up shop and clean up his act – he simply pivoted to a different scheme. Today’s sentence holds him accountable for the harm he’s caused and brings a measure of justice for his victims."
Salerno will also have to pay $549,835 in restitution.
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