Thank you for sharing!

Your article was successfully shared with the contacts you provided.
More than a decade after Boca Raton, Fla.-based clothing and cosmetics company Cascade International Inc. collapsed in scandal, a federal district court judge in Miami has ordered a former Cascade board member to disgorge $4.8 million in ill-gotten stock trading profits and interest. The former board member, Lawrence D. Moses, a dentist with a home in Boca Raton and a practice in Norristown, Pa., is fighting the order. Last month, he filed an appeal of U.S. District Judge Patricia Seitz’s February disgorgement ruling in a fraud case brought by the U.S. Securities and Exchange Commission. The decision caps seven years of trial-level litigation against half a dozen civil defendants. The actions have sought to recapture some of the $170 million lost by investors during the Cascade scam. The publicly traded company collapsed after chairman and chief executive Victor Incendy allegedly took a lot of the money and ran. “Moses was the last one. This settles it,” said Teresa Verges, U.S. SEC regional trial counsel. “I’m not sure, though, if he’s in a position to pay anything.” Jane Moscowitz, of Moscowitz Moscowitz & Magolnick in Miami, who represented Moses, expressed dismay that Cascade continues to dog her client, who she says has already paid hundreds of thousands and cooperated with the government. The SEC has said Cascade stoked its stock price by inflating its balance sheet and making exaggerated claims about its operations in filings with the SEC. The agency said those alleged lies boosted the price of a share of Cascade’s stock from $1.75 in 1988 to nearly $12 a share by the time Incendy disappeared in 1991 and Cascade cratered in November of that year. Incendy was indicted in 1994 in absentia on more than 100 counts of conspiracy, money laundering and fraud, and remains a fugitive from those charges. Federal authorities previously have said Incendy fled with a lot of Cascade’s money. In 1995, Moses pleaded guilty to being part of a related scheme allegedly hatched by Incendy. The scheme involved taking advantage of the company’s rising stock price by selling millions of unregistered, bogus shares of Cascade’s stock to thousands of unwitting investors. The same year, Moses was hit with the SEC fraud complaint that led to Judge Seitz’s recent disgorgement order. In court papers filed in the SEC fraud case, Moses admitted selling about 1.8 million unregistered shares of Cascade stock. The gross take from those sales was $6.1 million, of which about $2.4 million was profit. Moses, in fighting the government’s effort to collect money from him, claimed he never had access to those profits. He also argued that if he had to pay, he was entitled to a reduction as a setoff for “business” expenses he incurred in carrying out his scheme, according to court papers. In a 1999 ruling, U.S. District Judge Lenore C. Nesbitt brushed aside those arguments, holding that Moses violated federal securities laws and had to pay $2.1 million. SEC lawyers also asked the court to order Moses to pay another $2.7 million in prejudgment interest. But Nesbitt became ill before she could rule and died last October. The case languished for more than a year until it was reassigned to Judge Seitz last December. In February, Seitz agreed with the SEC and ordered Moses to pay $4.8 million. Back in 1998, other defendants in the case, including Incendy and his ex-wife, former Cascade president Jeannette Incendy Nelisse, were hit with similarly large disgorgement orders. Incendy, a native of Hungary who turned 68 on Monday, is still on the FBI’s wanted list and believed to be living in Europe or South Africa. His picture and biography are posted on the U.S. government’s International Broadcasting Bureau’s International Crime Alert Internet page.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.