Disbarred Somerset County attorney admits defrauding victims in Ponzi-like wire fraud scheme
HILLSBOROUGH TOWNSHIP, NJ (Somerset County) – A Somerset County disbarred attorney Wednesday admitted a wire fraud scheme that caused losses of more than $1 million, according to U.S. Attorney Philip R. Sellinger.
Lawrence Coven, 61, of Hillsborough Township pleaded guilty before U.S. District Court Judge Robert Kirsch in Trenton federal court to an information charging him with one count of wire fraud.
According to documents filed in this case and statements made in court, Coven operated and controlled Sunrise Enterprises LLC, which purported to provide financial services to investors. In reality, Coven induced victim investors into sending him funds by falsely representing that he would invest their money through Sunrise in exchange for large profits by providing short-term loans to borrowers who could not obtain standard loans. He falsely guaranteed investors returns of between 10 to 15 percent on their investments and told investors that their investments were risk-free.
But instead of investing the money as he promised, Coven diverted investor funds for personal expenses, including utilities, entertainment, real estate, credit card bills, and cash withdrawals. And when investors began asking questions, Coven provided them with false assurances that their money was safe and used money from existing investors to make payments to other investors in a Ponzi-like fashion.
The wire fraud charge carries a maximum penalty of 20 years in prison and a maximum fine of $250,000 or twice the gross gain to the defendant or loss to the victim, whichever is greatest, Sellinger said.
Sentencing is scheduled for Feb. 13, Sellinger said.