ALBANY — The owner of Blue Line Brewery pleaded guilty Tuesday in U.S. District Court to securities fraud in connection with a scheme to steal nearly $400,000.
Mark J. Gillis, 47, Saranac Lake, admitted to purchasing shares of a stock and then transferring the shares to three Hudson Valley customers at improper markups of up to 280 percent, according to a news release issued Tuesday by Acting United States Attorney Grant C. Jaquith and Vadim D. Thomas, special agent in charge of the Albany field office of the Federal Bureau of Investigation.
Mr. Gillis was originally charged with three counts of wire fraud and one count of securities fraud.
Mr. Gillis, the owner of Blue Line Brewery, Saranac Lake, and the newly opened Potsdam location at 43 Maple St., was formerly the co-owner of the holding company Hudson Valley Capital Management LLC, in 2012, as well as the company’s chief executive officer, chief compliance officer, chief financial officer and financial and operations principal, according to the federal indictment filed on July 19.
Mr. Gillis was a securities broker-dealer with offices in Saranac Lake and Croton-on-Hudson, N.Y. He was a licensed stockbroker and worked out of Saranac Lake.
“As a result of the markups, Gillis stole $379,652.41 from the customers,” the release stated. “Gillis did this to cover up a nearly $400,000 loss he suffered while trading securities for his own benefit.”
Mr. Gillis faces up to 25 years in prison with five years of post-release supervision and a fine of up to $250,000.
Sentencing is scheduled for April 9 in Albany by Senior United States Judge Norman A. Mordue.
Mr. Gillis will also be required to forfeit $379,652.41 to the United States. The Securities Investor Protection Corporation insured the investors’ losses.
“When Mark Gillis, a licensed stockbroker, lost $400,000 on his personal trades, he covered those losses by stealing more than $379,000 from his customers,” Mr. Jaquith said in the statement. “He will now be held accountable for his greed. We will continue to protect investors by charging stockbrokers who do not follow the rules and abuse their positions of trust.”
This case was investigated by the FBI and is being prosecuted by Assistant U.S. Attorney Cyrus P.W. Rieck.