Manhattan District Attorney Cyrus R. Vance, Jr., today announced the indictment of CARY BUNIN, 69, for a securities fraud scheme that resulted in the theft of more than $3.5 million from at least 16 victims. BUNIN is the Chief Executive Officer of INTERNATIONAL BARCODE CORPORATION, which also operates under the name of BTI. BUNIN and his corporation are charged in the indictment with Grand Larceny in the Second Degree, Scheme to Defraud in the First Degree, and violations of the Martin Act, New York State's securities fraud statute. BUNIN, along with his wholly-owned financial consulting company, ANDOVER CONSULTING SERVICES, LTD, were also indicted on charges of Offering a False Instrument for Filing in the First Degree and violating the New York State Tax code.[1]
“CARY BUNIN and his corporation are charged with stealing millions of dollars from trusting investors, fueling the type of widespread mistrust that adversely affects our financial markets,” said District Attorney Vance. “The Manhattan District Attorney’s Office is committed to working with the State Legislature to strengthen the Martin Act so that a person charged with a $3.5 million securities fraud doesn’t receive the same sentence as someone charged with a $350 securities fraud.”
According to documents filed in court, BUNIN began operating his fraudulent scheme beginning in approximately 2003 while serving as the CEO of BTI, whose offices are located in Midtown Manhattan. On its website, BTI states that its barcodes allow for the storage of significantly more data than standard barcode technology, and could be applied to identification cards used for security purposes, or for the detailed tracking of information about pharmaceutical products.
As CEO of BTI, BUNIN is charged with tricking individuals into investing in the company by using false promises and deceitful representations. For example, he falsely told potential investors that millions of dollars were about to be invested in BTI by various parties, and that multi-million dollar deals were forthcoming. In discussing with potential investors how they could earn money on their investment, BUNIN also falsely represented that multiple investment banks were about to issue a credit/debit card that would allow shareholders to obtain liquidity without having to sell shares for which there was, at that point, no market.
Additionally, BUNIN convinced investors to provide collateral to BTI to establish lines of credit that the company was authorized to use to maintain its day-to-day operations, but not for other purposes. According to documents filed in court, on one occasion, BUNIN, without authorization, withdrew $300,000 of such collateral from a bank account and used it to pay a company debt. When confronted by the collateral-holder about BTI’s misuse of the money, BUNIN falsely claimed that collateral-holder owed the money due to prior business dealings and refused to return the funds.
BUNIN is also charged with evading payment of more than $100,000 in New York City and New York State taxes from 2004 to 2009 by failing to report BTI’s rental payments for his Manhattan apartment as income; paying himself through ANDOVER CONSULTING SERVICES, LTD, which allowed him to make false business deductions to which he was not entitled; and claiming to be a resident of Florida while maintaining a full time residency in New York, which allowed him to evade New York City taxes.
BUNIN, BTI, and ANDOVER CONSULTING SERVICES, LTD, as well as Elayna Scott, BUNIN’s wife and a board member of BTI, are also defendants in a $3.5 million asset forfeiture action filed by the District Attorney’s Office, which includes the proceeds and substituted proceeds obtained by their criminal activity. The District Attorney’s investigation into the defendants’ activities continues.
Assistant District Attorneys Judith Weinstock and Edward Burns of the Major Economic Crimes Bureau are prosecuting the case under the supervision of Deputy Bureau Chief Polly Greenberg and Bureau Chief Richard Weber. Investigator Matthew Winters, Supervising Investigator Michael Wigdor, Trial Preparation Assistants Richard Kim and Peter Shakro, and former Trial Preparation Assistant Lee Parnes assisted in this investigation.
Defendant Information:
CARY BUNIN, D.O.B. 10/30/1941
New York, New York
Charges:
* Grand Larceny in the Second Degree, Class C felony, 10 counts
* Criminal Tax Fraud in the Third Degree, Class D felony, 2 counts
* Scheme to Defraud in the First Degree, Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(5), Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(6), Class E felony, 9 counts
* Offering a False Instrument for Filing in the First Degree, Class E felony, 6 counts
* Filing a False Return for Personal Income and Earnings Tax, Class E felony, 4 counts
INTERNATIONAL BARCODE CORPORATION a/k/a BTI
New York, New York
Charges:
* Grand Larceny in the Second Degree, Class C felony, 10 counts
* Scheme to Defraud in the First Degree, Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(5), Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(6), Class E felony, 9 counts
ANDOVER CONSULTING SERVICES, LTD.
New York, New York
Charges:
* Criminal Tax Fraud in the Third Degree, Class D felony, 2 counts
* Offering a False Instrument for Filing in the First Degree, Class E felony, 6 counts
* Filing a False Return for Personal Income and Earnings Tax, Class E felony, 4 counts
A class C felony in punishable by up to 15 years in prison, a class D felony is punishable by up to 7 years in prison, and a class E felony is punishable by up to 4 years in prison.
“CARY BUNIN and his corporation are charged with stealing millions of dollars from trusting investors, fueling the type of widespread mistrust that adversely affects our financial markets,” said District Attorney Vance. “The Manhattan District Attorney’s Office is committed to working with the State Legislature to strengthen the Martin Act so that a person charged with a $3.5 million securities fraud doesn’t receive the same sentence as someone charged with a $350 securities fraud.”
According to documents filed in court, BUNIN began operating his fraudulent scheme beginning in approximately 2003 while serving as the CEO of BTI, whose offices are located in Midtown Manhattan. On its website, BTI states that its barcodes allow for the storage of significantly more data than standard barcode technology, and could be applied to identification cards used for security purposes, or for the detailed tracking of information about pharmaceutical products.
As CEO of BTI, BUNIN is charged with tricking individuals into investing in the company by using false promises and deceitful representations. For example, he falsely told potential investors that millions of dollars were about to be invested in BTI by various parties, and that multi-million dollar deals were forthcoming. In discussing with potential investors how they could earn money on their investment, BUNIN also falsely represented that multiple investment banks were about to issue a credit/debit card that would allow shareholders to obtain liquidity without having to sell shares for which there was, at that point, no market.
Additionally, BUNIN convinced investors to provide collateral to BTI to establish lines of credit that the company was authorized to use to maintain its day-to-day operations, but not for other purposes. According to documents filed in court, on one occasion, BUNIN, without authorization, withdrew $300,000 of such collateral from a bank account and used it to pay a company debt. When confronted by the collateral-holder about BTI’s misuse of the money, BUNIN falsely claimed that collateral-holder owed the money due to prior business dealings and refused to return the funds.
BUNIN is also charged with evading payment of more than $100,000 in New York City and New York State taxes from 2004 to 2009 by failing to report BTI’s rental payments for his Manhattan apartment as income; paying himself through ANDOVER CONSULTING SERVICES, LTD, which allowed him to make false business deductions to which he was not entitled; and claiming to be a resident of Florida while maintaining a full time residency in New York, which allowed him to evade New York City taxes.
BUNIN, BTI, and ANDOVER CONSULTING SERVICES, LTD, as well as Elayna Scott, BUNIN’s wife and a board member of BTI, are also defendants in a $3.5 million asset forfeiture action filed by the District Attorney’s Office, which includes the proceeds and substituted proceeds obtained by their criminal activity. The District Attorney’s investigation into the defendants’ activities continues.
Assistant District Attorneys Judith Weinstock and Edward Burns of the Major Economic Crimes Bureau are prosecuting the case under the supervision of Deputy Bureau Chief Polly Greenberg and Bureau Chief Richard Weber. Investigator Matthew Winters, Supervising Investigator Michael Wigdor, Trial Preparation Assistants Richard Kim and Peter Shakro, and former Trial Preparation Assistant Lee Parnes assisted in this investigation.
Defendant Information:
CARY BUNIN, D.O.B. 10/30/1941
New York, New York
Charges:
* Grand Larceny in the Second Degree, Class C felony, 10 counts
* Criminal Tax Fraud in the Third Degree, Class D felony, 2 counts
* Scheme to Defraud in the First Degree, Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(5), Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(6), Class E felony, 9 counts
* Offering a False Instrument for Filing in the First Degree, Class E felony, 6 counts
* Filing a False Return for Personal Income and Earnings Tax, Class E felony, 4 counts
INTERNATIONAL BARCODE CORPORATION a/k/a BTI
New York, New York
Charges:
* Grand Larceny in the Second Degree, Class C felony, 10 counts
* Scheme to Defraud in the First Degree, Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(5), Class E felony, 1 count
* Violation of the General Business Law (Martin Act), §352c-(6), Class E felony, 9 counts
ANDOVER CONSULTING SERVICES, LTD.
New York, New York
Charges:
* Criminal Tax Fraud in the Third Degree, Class D felony, 2 counts
* Offering a False Instrument for Filing in the First Degree, Class E felony, 6 counts
* Filing a False Return for Personal Income and Earnings Tax, Class E felony, 4 counts
A class C felony in punishable by up to 15 years in prison, a class D felony is punishable by up to 7 years in prison, and a class E felony is punishable by up to 4 years in prison.
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