Opinion ID: 200195
Heading Depth: 2
Heading Rank: 3

Heading: Rheaume Agreement

Text: 9 Brite entered into an agreement in March 2000 with Rheaume Holdings (Agreement). The Agreement stated that `Brite' will attempt to pay benefits on a best efforts basis at a minimum average over a 90 day period of 10% per week of the amount invested. According to the Agreement, the first payment should have occurred twelve international banking days from the receipt of Rheaume's deposit by Raymond James. 10 On May 8, 2000, Fife wrote a letter to Rheaume ensuring the safety, security, monitoring and auditing of our client funds is and always will be my primary function. So without hesitation I state to you that absolutely your deposit is safe, secure, unencumbered, will not be invested without your authorization, can not be moved, or withdrawn without your approval. With regard to the enhancement program, Fife stated, I myself have been successful for the past six months doing the same placement of funds. The letter further represented that there would be no risk of loss and that Rheaume would receive benefits from its investment in the next two weeks. 11 Almost immediately after Rheaume's investment was in Fife's control, Fife began transferring funds from the Brite Account at Raymond James into the Capalbo Account at Raymond James. These funds were transferred without Rheaume's knowledge or authorization. The funds in the Capalbo Account were invested in securities without Rheaume's knowledge or authorization, and funds in the Capalbo Account were thereafter transferred into another Capalbo Account at Citizen's Bank without Rheaume's knowledge or authorization. Moreover, Fife no longer had direct control over the investments since he was not a signatory on the accounts. 12 In July 2000, Robert Curl (Curl), Rheaume's representative, requested a report of the balance in Rheaume's account. Fife forwarded letters from Herula to Curl on Raymond James letterhead reporting Rheaume's investment plus accrued interest in the Brite Account at Raymond James. However, these reports were false since the funds in the Brite Account were nearly depleted. After several months, Curl requested the return of Rheaume's funds. Fife told Curl that the money could not be returned because Raymond James worried about large sums of cash coming in and going out of an account in a short period of time. This statement was false. 13 A few months later, Fife suggested to Rheaume that it transfer its $12.5 million investment plus accrued interest in the Brite Account at Raymond James to an account at Charles Schwab in order to facilitate a swift return. In December 2000, Fife advised Curl that the money was transferred to a Capalbo Account at Charles Schwab. Charles Schwab account statements were forwarded to Rheaume by Fife. 14 Throughout 2001, Fife, Herula, and Capalbo sent Curl forged Charles Schwab account statements showing upwards of $59 million in the account. Curl was told that Rheaume's investment plus accrued interest was now pooled with other investor funds in the Capalbo Account at Charles Schwab, and these funds would eventually be transferred to Fife's trading program at Seaview. These funds, however, were never moved to Charles Schwab. 12 15 After these funds were allegedly placed in the Charles Schwab account, Curl again requested the return of Rheaume's funds. Fife then advised Curl that the National Association of Securities Dealers (NASD) had frozen the account. The NASD, however, never froze this account. Fife offered to use Rheaume's money in other finance deals once the NASD released the money in the Charles Schwab Account. Fife stated that he would be able to use Rheaume's money to generate excellent returns on other project finance deals.