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Investment adviser gets 11 years for fraud

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James Lagona’s fall from grace started with allegations of a Ponzi scheme that victimized dozens of people and culminated in a high-profile trial that found him guilty of fraud and conspiracy.

If that wasn’t bad enough, Lagona compounded his woes by trying to influence the federal prosecutor overseeing his case.

Lagona’s legal travails ended Wednesday when Chief U.S. District Judge William M. Skretny sentenced him to 11 years in prison.

“You were aware of the scheme,” Skretny said of Lagona’s involvement in the fraud. “You could have stopped it, but you didn’t.”

Lagona’s sentence stems from his two run-ins with the law.

He and fellow defendant Ian Campbell Gent were convicted of fraud and conspiracy in early 2011 for their role in an Amherst-based Ponzi scheme that cheated 90 victims, many of them retirees.

During the trial, Lagona and Gent portrayed themselves as victims and denied knowingly helping Guy Gane and his company, Watermark Financial Services of Amherst.

Lagona continued to maintain his innocence during his sentencing Wednesday.

“I had no idea the money was missing from the accounts,” he told Skretny. “I had absolutely no idea money was being taken out.”

Prosecutors say Gane cheated Watermark’s customers by telling them he was investing their money in valuable waterfront real estate in Maine but never actually bought those properties.

Gane, who many believe was the mastermind behind the scheme, eventually pleaded guilty to fraud and money-laundering charges and agreed to testify against Lagona and Gent.

Gane was sentenced to 13 years in prison. Gent got eight years.

After his initial fraud conviction, Lagona tried to get the case overturned by influencing U.S. Attorney William J. Hochul Jr. through his wife, then-Rep. Kathleen Hochul.

In the days leading up to last year’s November election, Lagona approached one of Kathleen C. Hochul’s campaign aides and offered what prosecutors called a “quid pro quo.”

He told the aide that he would campaign for the Hamburg Democrat and do his best to woo undecided Catholic voters – he’s a self-described Christian mystic and psychic and a leader in the Western Rite Orthodox Catholic Church. In return, Lagona proposed that Hochul’s husband would have to dismiss his upcoming sentencing for fraud.

A day later, he met with the campaign aide again and repeated his offer.



email: pfairbanks@buffnews.com

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