Former Campbell Mayor Krinos guilty of $1.2 million investment f - WFMJ.com News weather sports for Youngstown-Warren Ohio

Former Campbell Mayor Krinos guilty of $1.2 million investment fraud

Posted: Updated:
George Krinos George Krinos
CLEVELAND, Ohio -

A former mayor of the City of Campbell could face more than a year in prison when he is sentenced for perpetrating a nearly $1.2 million investment fraud scheme.

George Krinos, 39, of Boardman, appeared in U.S. District Court on Thursday, where he pleaded guilty to one count of securities fraud and one count of willfully failing to pay taxes.

Krinos signed a waiver acknowledging that the charges are punishable by more than one year in prison.

He's scheduled to be sentenced on May 30 after a presentence investigation report is completed.

Bond was set at $20,000.

Krinos, who was Campbell Mayor from 2010 until his resignation a year later, used his companies known as Krinos Holdings to engage in a securities fraud scheme in which he sold through false and deceptive practices securities to at least ten people in Ohio, according to prosecutors.

The securities consisted of notes and private placement memoranda that were not properly registered with the Securities and Exchange Commission.

Because the securities were not registered with and therefore subject to greater scrutiny by the SEC, Krinos was limited to selling them to “accredited investors” who were generally individuals having a net worth in excess of $1 million or who met specific, high-dollar income thresholds.

From 2011 through 2014, Krinos sold the unregistered securities to the investors, causing them financial losses.

Krinos sold the securities under the pretense that his investors’ funds would be used for legitimate business purposes, including to provide venture capital to various client companies seeking funding from Krinos Holdings.

Rather than use these funds for their intended uses, Krinos instead used the money for personal expenses and to engage in unauthorized foreign currency transactions.

To entice his victims, Krinos made promises that their initial investments of $.10 per share would rise in value to as much as $5 or $6 per share.

Krinos also falsely told investors and others that he managed approximately $600 million in an investment account when he in fact had only $5 in the account.

In addition, Krinos submitted falsified letters and statements to reflect high balances in his accounts.

Krinos also falsely told investors that they were making high returns on their investments and that his relationships with the client companies was on good terms.

Contrary to his representations to his investors, Krinos actually used their funds on for his own personal use at restaurants, bars, casinos, adult entertainment clubs and hotels.

Rather than disclose these personal expenses, Krinos later characterized them as “sales and marketing” costs in a budget given to his shareholders at a meeting in Boardman, in 2013.

In addition to the securities fraud scheme, Krinos improperly withheld taxes, including federal income taxes and Federal Insurance Contribution Act taxes from his employees without paying over those taxes to the IRS. Over the course of approximately two years, Krinos improperly withheld and kept approximately $91,495 of his employees’ tax contributions from the IRS.

  • More From wfmj.comHot ClicksMore>>

  • Mother of girl declared dead twice slams doctors at funeral

    Mother of girl declared dead twice slams doctors at funeral

    Wednesday, July 11 2018 3:52 PM EDT2018-07-11 19:52:14 GMT
    (AP Photo/Jeff Chiu, File). FILE - In this Dec. 23, 2015, file photo, a photo of Jahi McMath is shown on a video screen next to her uncle Timothy Whisenton at a news conference in San Francisco. The mother of a girl at the center of a medical and relig...(AP Photo/Jeff Chiu, File). FILE - In this Dec. 23, 2015, file photo, a photo of Jahi McMath is shown on a video screen next to her uncle Timothy Whisenton at a news conference in San Francisco. The mother of a girl at the center of a medical and relig...
    Dozens of family members, friends and other mourners have filed into a Northern California church for the funeral of a teenage girl at the center of a medical and religious debate over brain death.More >>
    Dozens of family members, friends and other mourners have filed into a Northern California church for the funeral of a teenage girl at the center of a medical and religious debate over brain death.More >>
  • Study provides clues to fate of early North American dogs

    Study provides clues to fate of early North American dogs

    Monday, July 9 2018 8:28 PM EDT2018-07-10 00:28:18 GMT
    (AP Photo/Mary Altaffer, File). FILE - In this Feb. 15, 2016, file photo, a xoloitzcuintli is shown in the ring during the non-sporting group competition at the140th Westminster Kennel Club dog show, at Madison Square Garden in New York. A new study pu...(AP Photo/Mary Altaffer, File). FILE - In this Feb. 15, 2016, file photo, a xoloitzcuintli is shown in the ring during the non-sporting group competition at the140th Westminster Kennel Club dog show, at Madison Square Garden in New York. A new study pu...
    New study provides clues to fate of early North American dogs that were all but wiped out after the arrival of Europeans.More >>
    New study provides clues to fate of early North American dogs that were all but wiped out after the arrival of Europeans.More >>
  • Buddhist meditation may calm team trapped in Thai cave

    Buddhist meditation may calm team trapped in Thai cave

    Monday, July 9 2018 6:36 PM EDT2018-07-09 22:36:34 GMT
    (Tham Luang Rescue Operation Center via AP, File). FILE - In this handout photo released by Tham Luang Rescue Operation Center, Thai rescue teams use headlamps to enter a pitch-black cave complex where 12 boys and their soccer coach went missing, in Ma...(Tham Luang Rescue Operation Center via AP, File). FILE - In this handout photo released by Tham Luang Rescue Operation Center, Thai rescue teams use headlamps to enter a pitch-black cave complex where 12 boys and their soccer coach went missing, in Ma...
    The soccer coach stranded with 12 boys in a flooded Thai cave spent a decade as a Buddhist monk, honing a meditation skill that may serve him well during their ordeal.More >>
    The soccer coach stranded with 12 boys in a flooded Thai cave spent a decade as a Buddhist monk, honing a meditation skill that may serve him well during their ordeal.More >>
Powered by Frankly
All content © Copyright 2000 - 2018 WFMJ. All Rights Reserved. For more information on this site, please read our Privacy Policy and Terms