Father-Son Team Found Guilty of Bilking Investors in Rare-Coin Scam

The father-son masterminds of a Costa Mesa rare-coin scam were found guilty in federal court in Santa Ana on Friday of conspiracy, mail fraud and wire fraud for bilking investors out of $6 million.

The jury found Vincent L. Caterino, 58, of Riverside guilty on all 22 charges against him. His 28-year-old son, James N. Caterino, a Costa Mesa resident also known as Jack Elder, was found guilty on 20 of the charges against him. The jury was hung on one charge of using a fictitious name in a scheme to defraud and one charge each of mail and wire fraud.

Sentencing on May 19

When the two men are sentenced on May 19, Vincent Caterino could receive up to 110 years in a federal prison. James Caterino could be sentenced to a maximum 100 years and fined up to $5 million.

The two men--along with five colleagues--were indicted by a federal grand jury last September for a telemarketing scheme called Marco Numismatics that bilked more than 500 investors out of $6 million, said Assistant U.S. Atty. Thomas J. Umberg.

From the summer of 1985 through last September, the company sold mostly ancient Greek and Roman coins, including the silver denarius and double denarius and the gold aureus .

Although the coins were authentic, Umberg said, the basis of the case against Marco was that the company “misrepresented the value, quality and liquidity of the coins” they sold to investors throughout the United States.

Of the misrepresentations alleged in the indictment, the most important was that investors could liquidate their coins upon demand. Marco officials told customers that the company would act as a broker and sell their coins to willing buyers.

Coins Overpriced

The truth, Umberg said, was that the investors were stuck with grossly overpriced coins and no way to recoup their money. Trial evidence showed that Marco salesmen sold sets of coins called the Twelve Caesars of Rome to investors for $28,000, when in truth the coins were worth about $3,000.

“The coins they (Marco) sold could be purchased on average at about 10% of what they were selling them for,” Umberg said after the indictment. “They (Marco) also purchased one type of coin--the Roman denarius --for $35 and would sell it for approximately $600.”

In addition, Marco salesmen also would “churn” their clients’ accounts, Umberg said, performing an unnecessary number of transactions on behalf of the customers to reap increased commissions.

The federal jury could not reach a decision Friday in the case against Nicholas Caterino, 50, of El Toro or Brian Thompson, 28, of Orange. Nicholas Caterino is Vincent’s brother and was Marco’s coin buyer. Thompson was a sales administrator for Marco.

During the 5 1/2-week trial, three Marco salesmen pleaded guilty to lesser charges. Patrick Zaremba, 28, address unknown, pleaded guilty to one count of felony wire fraud. Mark Colacchio, 29, of Corona, and Keith Taylor, 32, of Laguna Niguel each pleaded guilty to one count of felony mail fraud.

Zaremba, Colacchio and Taylor, who was also known as Mike Green, will be sentenced on April 20.

“We’re pleased with the outcome as to defendants James and Vincent Caterino, and we’re prepared to retry the other two,” Umberg said.