Swindling salesman convicted in the U.S. for a large Toronto investment fraud
Another swindling salesman who was ripping people off in a large Toronto investment fraud has been sent to prison in the United States, nearly ending prosecutions against a rapacious band of coloured diamond conmen.
Edward Rosenberg used the alias Ed Rose when working the phones in a telemarketing boiler room on Toronto’s Finch Avenue West. The salesmen there for Paragon International Wealth Management, Inc. defrauded more than $21 million from hundreds of victims in Canada and the United States.
Details on the great Paragon swindle and the crooked life of one of its notorious Toronto fraudsters, Jack Kronis, is the focus of a long investigative feature in National Post published last summer, called Jack of Diamonds .
Rosenberg, 60, was arrested in December when he drove to the United States for a day trip with a friend. It was a shock for everyone.
Rosenberg was unaware he was wanted in the United States and was surprised when he was arrested at the border in Buffalo, said Mitchell Worsoff, his Toronto lawyer. U.S. authorities had not made any move to arrest or extradite Rosenberg over the years while he was secretly wanted.
Rosenberg was among those originally charged with fraud by Toronto police in 2018 for Paragon’s diamond swindles. Court heard that it stretched from 2013 until a Toronto police raid in 2018.
Charges against the men were later dropped in Ontario when the case was instead turned over to the U.S. Department of Justice to prosecute, because many of the victims were Americans.
While U.S. prosecutors proceeded with indictments against James Gagliardini, Michael Shumak, Jack Kronis, and Antonio Palazzolo — all Toronto area men who had agreed to plead guilty — Rosenberg was not prepared plead guilty to the allegations. After a voluntary interview with the FBI in Cleveland in 2022, Rosenberg was allowed to return to Canada without charge or restriction.
The other Paragon men were told to surrender to U.S. authorities, which they did.
Nobody knew that another indictment was secretly filed under seal against Rosenberg and another man in November 2022.
Since his arrest, Rosenberg has been held in custody. He was granted a public lawyer after telling a judge he didn’t have the money to pay for his legal defence.
At Rosenberg’s next court appearance, his U.S. lawyer told the judge that Rosenberg was looking to resolve his case quickly. In courtrooms, that’s usually code for negotiating a plea deal and that was confirmed in April when Rosenberg changed his plea. He pleaded guilty to a charge of conspiracy to commit wire fraud.
His U.S. lawyers told the judge that Rosenberg was hired to be a salesman at Paragon in 2017 and played a small role in the company’s large fraud, saying: “He was at the bottom.”
“Mr. Rosenberg is a man of strong moral character that made a serious mistake. Mr. Rosenberg is a compassionate and caring man. His participation in a conspiracy to defraud investors and customers is truly anomalous behaviour.”
Letters to the judge say Rosenberg is a rabbi who worked with grieving families and people with illness.
His former wife told the judge that Rosenberg has been a devoted father to their two children: “Despite working long hours both as a car salesman and clergy member, he made every effort to be involved in their lives, driving them to extracurricular activities, attending school functions, and spending meaningful time with them.”
His lawyer also told court that Rosenberg is a rabbi. His sister called him “a reverend” who married people and worked at funeral homes in a letter of support sent to the judge. A family friend said he “has helped many people in his role as Rabbi. He manages to console people through their grief. He has married many couples.”
A letter to the judge on letterhead for “Toronto Metropolitan Synagogue,” described in the letter as a “small but tight-knit congregation,” now defunct, said Rosenberg served as clergy there over two decades.
His name does not appear in the Ontario government’s database of the province’s nearly 22,000 registered marriage officiants.
His lawyer in the U.S. did not respond to a request for comment prior to deadline.
In May, Rosenberg was sentenced to 34 months in a U.S. prison — two months shy of three years.
He was placed in FCI Elkton, a low security federal correctional institution in Lisbon, Ohio, about a five-hour drive south of Toronto. A restitution hearing to determine how much he needs to pay back to victims was scheduled for next month but has since been pushed to August.
“I’m bothered by the sentence because that’s a significant sentence and if this was that significant a case to the U.S., they should have employed extradition proceedings,” said Worsoff, his lawyer in Canada.
“They were silent the last two years. He went in for an interview. Nothing came of it. And if it’s such a serious matter you think that they’d follow up and say we have a warrant for your arrest, make arrangements to turn yourself in, and, if not, we’re going to commence extradition proceedings.”
Meanwhile, the unsealing of the indictment against Rosenberg revealed the U.S. prosecution’s allegations against yet another man.
Ravi Poddar, a 45-year-old Mississauga, Ont., gem broker whose company claims to be Canada’s largest wholesaler of coloured diamonds, was accused of being the silent partner behind Paragon.
Poddar was in Canada when Rosenberg tripped up at the border. There has been no public activity on the U.S. prosecution against Poddar, according to U.S. court files.
Poddar earlier told the Post the accusations against him are false.
The diamond investment scheme, outlined in several Paragon court cases, used aggressive lies and salesmen’s tricks to persuade victims to buy coloured diamonds and jewelry as investments, claiming they were far more valuable than they really were. Victims were then milked of more money over months by salesmen insisting they needed to pay more to push their initial investment to a huge payday — a promised jackpot that never came.
Gagliardini was sentenced to 56 months in a U.S. prison in October. Shumak was sentenced to 60 months in February. Jack Kronis was sentenced last year to 37 months in prison. Antonio Palazzolo has not yet been sentenced.
• Email: ahumphreys@postmedia.com | Twitter: AD_Humphreys
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