Blau & Malmfeldt is investigating Queen City Investments, a reported Ponzi scheme operated by Glen Galemmo. Victims of Galemmo and Queen City Investments’ Ponzi scheme may pursue claims in arbitration at FINRA Dispute Resolution.
On July 17, 2013, Galemmo sent an email to investors announcing that his company, Queen City Investments, would be closing operations and that investors should direct any questions they had to the Cincinnati IRS branch office. The IRS and Justice Department are currently investigating Galemmo and have raided his offices.
Galemmo boasted that between 2006-2011, his funds quadrupled in value. This dramatic increase in value would’ve resulted in over $60 million in compensation for Galemmo himself under the fund’s compensation arrangements. In reality, the company had trouble meeting basic obligations such as paying taxes. It seems unlikely that the the fund made any actual investments.
Investors in the Queen City funds filed suit in Hamilton County Common Pleas Court, the local Cincinnati court, on July 20, 2013. They have also filed an injunction preventing Galemmo and his associates from accessing the funds. Galemmo and his wife have fled the Cincinnati area.
Class action suits tend to result in small recoveries for harmed investors. We believe that many investors stand a better chance of achieving a meaningful recovery in arbitration.
Victims of the Queen City Investments Ponzi scheme may fare better by pursuing FINRA arbitration claims against Galemmo and his brokerage firms. Outside business activities is known in the industry as “selling away.” Brokerage firms have an obligation to supervise their brokers outside business activities.
Galemmo’s FINRA registration shows he was employed by Lightspeed Professional Trading from 4/2007- 12/2007 and with Landmark Investment Group from 12/2009-09/2012. Before 2007, he was employed off and on with RM Stark & Co, Westmoore Trading Company, and Essex & York.
The companies that Galemmo and Queen City Investments were associated with include Galemmo Investments, Essex & York, QFC, QC Sweep, Sentinel Strategy, Glen Rock, Cincinnati Royals, and Midwest Hoops.
Blau & Malmfeldt is a law firm that represents investors across the United States in securities, commodity futures, partnership, and shareholder rights disputes. Please call us at 312-443-1600 or email Paul Malmfeldt at email@example.com to schedule a free consultation or learn more about the services we offer.