Partner of Cerilli sentenced for role in investment scheme
Frank DeBone, a former bar and club owner turned scam artist, will serve 37 months in a federal prison for being the ringleader of a group of fly-by-night salesmen who stole $5.6 million from elderly investors in a risky investment scheme.
U.S. District Court Senior Judge Donald Lee on Wednesday sentenced the 53-year-old Greensburg man for orchestrating the scam in which 81 elderly and ill investors lost money after purchasing bonds through his company, Appalachian Investments of Greensburg. The company was shut down in 1996 after a raid by federal agents.
DeBone is the next to last of seven defendants in the case who either pleaded guilty or were convicted of theft and mail fraud.
Another defendant, Dennis Cerilli, 54, of Hempfield Township, has not been sentenced. He pleaded guilty in June 2001 to mail fraud.
He also is scheduled to face a preliminary hearing Monday in Murrysville on charges that he stole $833,000 from investors through alleged scams in Armstrong and Westmoreland counties.
Cerilli, who now resides in Myrtle Beach, S.C., is charged with 64 counts of theft, deceptive business practices and writing bad checks for allegedly bilking 21 victims who had invested in a plan to build a concert amphitheater in Armstrong County. They also purchased the rights to concessions that Cerilli did not own at events at the Westmoreland Fairgrounds in 1998 and 1999.
Even though DeBone has maintained that Cerilli was the one who devised the scheme, federal prosecutors said DeBone orchestrated the deals by recruiting salesmen.
DeBone pleaded guilty to mail fraud in March as part of a plea bargain. Also awaiting sentencing are John Wayne Hinton, 53, pastor of Stony Creek Church of Christ in Somerset County; Robert C. Walters, 55, of Jeannette; Edmond Genest, 66, of Lower Burrell; and Dennis J. Oslosky, 41, of Delmont.
Another defendant, Joseph W. Beckner, 47, of Hempfield Township, who testified for the prosecution, was sentenced to one day in prison, one month of home detention and two years' probation. He also was required to pay more than $148,000 in restitution as part of his plea bargain with federal prosecutors.
DeBone and Cerilli operated two Greensburg advertising agencies, Compu-Tech and Consolidated Control and Management Inc. The firm sold advertising on the back of supermarket cash register receipts.
To expand their businesses, Cerilli and DeBone, according to court records, formed Appalachian Investments to sell high-risk bonds to unsophisticated investors.
Neither the firm, nor Cerilli and DeBone, had bothered to obtain licenses from the U.S. Securities and Exchange Commission to operate the company.
Federal prosecutors charged that the salesmen promised their clients a high rate of return on their investments but failed to inform them the bonds they were purchasing were risky.
Instead of expanding their business, Cerilli and DeBone, according to court records, used the investors' money to finance an extravagant lifestyle that included leasing luxury cars, purchasing expensive clothes and jewelry, and taking trips to Las Vegas.
They also purchased home furnishings. Cerilli even purchased a home in an upscale Hempfield Township plan and bought investment property in Greensburg.
DeBone formerly owned the William Penn Club in Greensburg and The Loft in Hempfield Township before going into the advertising business.
