The owner of a Greenwich investment business has pleaded guilty in connection with a $3.45 million investment fraud scheme, authorities said.
Stamford resident Justin Murphy, 50, on Tuesday pleaded guilty to one count each of money laundering and wire fraud in U.S. District Court in New Haven before Judge Victor A. Bolden.
Murphy owned and operated a business that he purported to be a hedge fund, Mara Investment Group LLC.
Between 2016 and 2022, Murphy defrauded investors “knowingly and with fraudulent intent,” according to the plea agreement. The scheme involved deceiving Mara investors through materially false pretenses, representations and promises, the agreement states.
For instance, Murphy pursued a much riskier investment strategy than he represented to clients, according to the agreement.
Also, he diverted investor funds for his own personal use and benefit, including purchasing a personal stake in a family member’s startup company, the agreement states.
Murphy lulled investors into believing their money was safe by representing to them that their investments were performing more favorably than they actually were, authorities said.
Further, Murphy provided investors with federal tax forms that falsely reported business income upon which investors would be required to pay tax, court documents state.
Authorities say Murphy stole roughly $3,465,812 in investor funds through the scheme.
Murphy faces between 70 to 87 months of imprisonment, in addition to one to three years of supervised release and a fine ranging from $25,000 to $250,000, according to the plea agreement. However, the judge could add or subtract from those numbers when Murphy is sentenced on Aug. 4.
Murphy was arrested in Brazil on Dec. 6, 2023, and was detained for nearly 11 months while awaiting extradition to the U.S. He has been released on a $250,000 bond since Nov. 1, 2024.
This investigation was conducted by the FBI and the IRS – Criminal Investigation Division. The Justice Department’s Office of International Affairs and Brazilian authorities provided assistance.
The case is being prosecuted by Assistant U.S. Attorney David E. Novick.
