Ponzi Financial Scheme By Attorney Leads To Jail

NEWARK, N.J. – A Somerset County, New Jersey, disbarred attorney was sentenced to 30 months in prison for a wire fraud scheme, U.S. Attorney Alina Habba announced.

Lawrence Coven, 61, of Hillsborough, New Jersey, previously 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. Judge Kirsch imposed the sentence.

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.

In addition to the prison term, Judge Kirsch sentenced Coven to three years of supervised release.

U.S. Attorney Habba credited special agents of the FBI, under the direction of Acting Special Agent in Charge Terence G. Reilly in Newark, with the investigation leading to this sentence.

The government is represented by Assistant U.S. Attorneys Fatime Meka Cano and Olta Bejleri of the Economic Crimes Unit in Newark.