Nora R. Dannehy, Acting United States Attorney for the District of Connecticut, and Susan Dukes, Special Agent in Charge for the Internal Revenue Service – Criminal Investigation Division in New England, today announced that a federal grand jury sitting in New Haven has returned a 16-count Indictment charging THOMAS CIPRIANO, 53, of Waterbury, with mail fraud and money laundering.

The Indictment alleges that CIPRIANO, while acting as principal of the Cipriano Agency, an insurance and financial services agency, and Selective Benefits Group, a financial services agency, both of which conducted business from 751 Watertown Avenue in Waterbury, convinced several clients to remove their money from conventional investments and from their personal bank accounts and to give him the money to “invest” by promising that they would be repaid with interest on their investment. It is alleged that CIPRIANO did not invest his clients’ funds in any sort of legitimate investment. Instead, he laundered those funds through his personal bank accounts and lost most of the money gambling at Connecticut casinos. He spent the rest of his clients’ money to pay for his own personal expenses or to make “lulling” payments to other clients.

It is alleged that CIPRIANO defrauded his clients of at least $456,000 through this scheme.

The Indictment was returned on February 10, 2009, and remained sealed until today when CIPRIANO appeared before United States Magistrate Judge Joan G. Margolis in New Haven and entered a plea of not guilty to eight counts of mail fraud and eight counts of money laundering. Following his arraignment, CIPRIANO was released on bond in the amount of $200,000.

If convicted, CIPRIANO faces a maximum term of imprisonment of 20 years and a fine of up to $250,000 on each of the mail fraud charges, and a maximum term of imprisonment of 10 years and a fine of up to $250,000 on each of the money laundering charges.

Acting U.S. Attorney Dannehy stressed that an indictment is only a charge and is not evidence of guilt. The defendant is entitled to a fair trial at which it is the Government’s burden to prove guilt beyond a reasonable doubt.

This matter was investigated by the Internal Revenue Service – Criminal Investigation Division. The case is being prosecuted by Assistant United States Attorney Susan Wines.