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Edward Espinal, 44, of Wayne advertised his Cash Flow company on YouTube, other social media and Spanish-language TV, sometimes using the Venezuelan telenovela actor Víctor Cámara, U.S. Attorney Craig Carpenito said.
Espinal, who was the company’s founder and CEO, ran a couple of scams beginning 3½ years ago and ending with his arrest by federal agents earlier this month, the U.S. attorney said.
In one, Cash Flow released Internet advertisements and held seminars offering to assist customers with low-paying salaries in obtaining loans,” Carpenito said.
Employees in the sales department encouraged customers attracted by the ads to sign up for various Cash Flow loan programs, he said.
Those who did were told they could keep a portion of the loan proceeds and must provide the rest to Cash Flow, which promised to pay off the loans for them, Carpenito said.
Cash Flow then doctored documents for the many who didn’t qualify and “posed as the customers in communications with the banks,” the U.S. attorney said.
In the other scam, Espinal solicited investments from prospective customers using a marketing campaign on Spanish-language television channels and the internet, the “Cash Flow TV” YouTube page, and live presentations in Cash Flow’s offices and elsewhere, Carpenito said.
He also recruited customers who’d signed up in the bank fraud conspiracy by encouraging them to invest their loan proceeds, he said.
Nearly five dozen people who signed up received “promissory notes” from Espinal that “guaranteed monthly investment returns between 1.25 percent and 4 percent” within a year – or 60 days after investors demanded payment, the U.S. attorney said.
Espinal lied, telling investors that he would “pool their funds with the funds of other investors in investments related to real estate, real estate companies, a gold mine in Ecuador, and construction projects in countries outside of the United States,” Carpenito said.
None of that ever happened, he said.
Instead, the U.S. attorney said, Espinal “used investor funds to pay returns to earlier investors, to pay for personal expenses for himself, his family, and another Cash Flow employee, to perpetuate the bank fraud scheme, and to market the bank fraud and investment scheme to future victims.”
Two others, Raymundo Torres and Jennie Frias (also known as Jennie Castillo), were previously charged for their roles in the loan scam. Torres has pleaded guilty.
The U.S. Securities and Exchange Commission (SEC) also filed a civil complaint against Espinal.
Carpenito credited special agents of the FDIC-Office of the Inspector General (FDIC-OIG), and special agents of the FBI with the investigation leading to the charges. He also thanked the SEC for assistance provided by its Enforcement Division.
Handling the case for the government is Assistant U.S. Attorneys Ari B. Fontecchio of Carpenito’s Economic Crimes Unit, and J. Stephen Ferketic of his Opioid Abuse Prevention and Enforcement Unit in Newark.
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