One investor was a retired couple now so broke that the husband, a senior citizen, is looking for work. Another man invested a seven-figure sum, including his son’s trust fund, and is now on the verge of bankruptcy. Several elderly couples took out mortgages to generate cash to invest.
They are among the 42 victims of a West Roxbury family whom Suffolk District Attorney Daniel F. Conley’s office alleges fleeced friends, acquaintances and neighbors out of more than $10 million using a classic Ponzi scheme.
In a new wave of indictments disclosed Thursday, prosecutors allege that Steven and Lori Palladino and their adult son, Gregory Palladino, 28, used money they had promised to invest on behalf of clients to finance their own lifestyle.
“This is among the largest investment scams we’ve seen since Charles Ponzi’s scheme right here in Boston almost 100 years ago,” Conley said in a statement. “The losses here are staggering, and many of the victims are ordinary men and women who have seen their assets disappear overnight.”
Viking Financial Group, the company where the Palladinos were the sole employees, also faces charges, prosecutors said.
The Palladinos and the company face charges that include larceny over $250, conspiracy to commit larceny, usury, and tampering with evidence. The Palladinos also face charges of larceny over $250 from a person over 60, because seven of their alleged victims were over 60.
Steven and Lori Palladino, 56 and 52 respectively, had previously pleaded not guilty to running the Ponzi scheme. On Sept. 30, the couple and their son are all scheduled to be arraigned on the new wave of charges in Suffolk Superior Court.
Prosecutors said the Palladinos collected the money, promising a high yield from loans Viking would make to borrowers. But very little of the money was used to make loans, authorities said. Instead, the money allegedly funded a lavish lifestyle for the Palladinos.
Prosecutors said the money was often allegedly transferred from the company’s account into personal accounts of the Palladinos. The money was then spent on items such as luxury vehicles, a vacation in the Bahamas, rent for Steven Palladino’s mistress, and payments to casinos to cover apparent gambling losses, prosecutors alleged.
The indictments also moved an additional recent usury case against Steven Palladino from District Court to Superior Court. In that case, Palladino had allegedly loaned money to a businesswoman and demanded 40 percent interest, double the maximum allowable under state law, prosecutors allege.
One of the alleged victims, a retired doctor, Ronald J. Nasif, said he hopes the new criminal charges will prompt Steven Palladino to do something all of the alleged victims desperately need him to do.
“We need to know where our money went,’’ said Nasif, who declined to specify how much he lost. “Only the Palladino family knows where this money went. Tell us where the money is!”
But Mitchell Zuckoff, a former Globe reporter and author of “Ponzi’s Scheme: The True Story of a Financial Legend,” said that, in general, victims of Ponzi schemes collect just pennies on the dollars they have invested with the scam operator.
“I can’t speak to this one specifically, but usually by the time a Ponzi schemer is found, he or she has found a way to spend a large portion of the money collected,’’ said Zuckoff, now a Boston University journalism professor.John R. Ellement can be reached at ellement@
globe.com. Follow him on Twitter @JREbosglobe.