O.C. Teen Infamous for Internet Scam Faces Charges in Bank Fraud

A Mission Viejo teenager who paid more than $1.2 million last year to settle federal Internet-fraud complaints has been charged with conspiracy to defraud an Orange County bank of $450,000.

Cole Bartiromo, who gained notoriety two years ago when he was alleged to have been one of the nation’s youngest Internet con artists, is facing federal fraud charges in an alleged wire transfer scheme at a Wells Fargo Bank in Mission Viejo.

Bartiromo, 19, insisted Thursday that he is innocent and that the Securities and Exchange Commission has told other federal agencies to target him as a result of the Internet scheme.

According to a federal affidavit, Bartiromo admitted his role in the bank fraud. His trial is scheduled March 9 in federal court. If found guilty, the maximum penalty is five years in prison and a $250,000 fine.

The indictment says Bartiromo attempted to recruit a Wells Fargo employee to let him wire funds from a customer’s account to an offshore bank and gamble with the money through a British sports book.

He said he would return the money to the account, less his winnings, before the account’s owner knew the money was missing, according to the indictment.

The employee notified a supervisor, who contacted the Secret Service. Federal agents set up a dummy account and arrested Bartiromo on Aug. 25 after he transferred the money.

Also arrested were his friends, Oscar Godinez, and Theo Liu, both 20.

Godinez helped Bartiromo recruit the bank employee and Liu allegedly provided Bartiromo false identification, the indictment said.

Bartiromo, in a telephone interview, said he has tried to stay out of trouble since his Internet troubles and is studying screenwriting at Saddleback College so he can write a movie about his own life.

“These charges are groundless,” he said. “The government framed me and set me up for this bank fraud.”

Bartiromo also said the IRS has unfairly ordered tax audits for him and his parents.

Thom Mrozek, a spokesman for the U.S. attorney’s office in Los Angeles, denied the government was singling out the young defendant.

Mrozek said the government believes it has a strong case against Bartiromo and his two co-defendants.

“We’re confident that 12 jurors will examine the evidence and return a guilty verdict in the case,” he said.

While Mrozek admitted that it’s unusual to see teenagers accused of white collar crimes, he also said it’s not unheard of.

Barry Minkow, for example, started the carpet-cleaning businesses ZZZZ Best at 19 and built it into a multimillion-dollar business in 1988 before being found guilty of fraud.

According to an affidavit by Matthew Shields, a special agent for the Secret Service, Bartiromo admitted his role in the bank fraud. Bartiromo’s plan, he said, was to wire $400,000 to the London sports book and gamble with $40,000 of it.

Bartiromo told Shields he intended to give Liu and Godinez a share of the money depending on how successful he was as a gambler, the affidavit stated.

Bartiromo’s first heard from federal law enforcement authorities when the SEC filed a civil complaint in 2002 over Bartiromo’s “Invest Better 2001” online betting company.

The SEC also cited Bartiromo, then a Trabuco Hills High senior, over a scheme in which the agency said he bought shares in penny-stock companies through his father’s online account, flooded investor chat rooms with e-mail rumors about pending takeovers and then cashed out when the stock prices rose.

The “Invest Better 2001” case is still pending.

Bartiromo took the Fifth Amendment against self-incrimination and did not aid SEC investigators, said Alexander M. Vasilescu, the SEC lawyer in New York monitoring the case. The SEC has gone to court seeking an additional civil penalty of more than $100,000 from Bartiromo, he said, and could refer the case to the U.S. Attorney’s Office for criminal action, the lawyer said.

Last year, Bartiromo sued his high school for $50 million, saying that he was barred from the baseball team because he was labeled an embarrassment and “personal vendettas.”

Despite his legal problems, he wants to get into the entertainment field, possibly as a rapper, like Eminem.

He said he wants to tap into a new, hip-hop style that emphasizes suburbia. “Kind of a twisted tale of a white kid dealing with government corruption and conspiracy,” he said.