Crime

A husband and wife from West Roxbury are accused of running a multimillion-dollar Ponzi scheme that prosecutors said paid for their lavish lifestyle including vacations, casino trips and rent for the husband's mistress.

Steven Palladino, 55, and his wife, Lori, 52, were indicted last week by a Suffolk County grand jury, the Suffolk district attorney's office said Monday. The couple faces multiple charges including larceny over $250, making false entries in corporate books and loansharking. Steven Palladino is also charged as a common and notorious thief based on more than two dozen prior larceny convictions out of Suffolk and Norfolk counties.

Steven Palladino is due for arraignment in Suffolk Superior Court on Monday afternoon. His wife is scheduled for arraignment next month.

 

Lori Palladino and the couple's 28-year-old son incorporated Viking Financial Group, Inc., in 2007. The couple and their son are the only employees of the company, authorities said.

A joint investigation by the district attorney's office and Boston police alleges that the couple borrowed money from investors and were told that the funds would be used to provide loans at a higher interest rate. Instead, money borrowed from new investors was used to repay prior investors and to make interest payments to all of the investors, authorities said. Viking allegedly charged as much as 60 to 200 percent interest on some of the loans, well above the 20 percent maximum allowed under state law.

Prosecutors allege that transactions show the money was transferred to personal accounts and used to cover expenses including hundreds of thousands of dollars to casinos to cover gambling loses, a vacation to the Bahamas and rent for Steven Palladino's mistress.

It is also alleged that Steven Palladino made use of investors' money to pay off $350,000 - a condition of his probation on a 2007 conviction for defrauding an elderly relative.

To cover the scheme, prosecutors said false loans were entered in Viking's books.

A complaint has been made against the Viking corporation and the grand jury investigation is ongoing.

Follow Michael Naughton on Twitter @metrobosmike.

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