PHILADELPHIA – United States Attorney David Metcalf announced that Joseph LaForte, 54, of Philadelphia, Pennsylvania, was sentenced today by United States District Court Judge Mark A. Kearney to 186 months in prison and three years of supervised release, to include 12 months in home confinement, for numerous crimes arising from the defendant’s operation of a fraudulent investment vehicle known as Complete Business Solutions Group Inc. d/b/a Par Funding (“Par Funding”). In addition, LaForte was sentenced to forfeit various assets, including a private jet and an investment account totaling approximately $20 million, along with a $120 million forfeiture money judgment, as well as restitution in the amount of $314 million, and a $50,000 fine.
In January 2025, the Court found the Par Funding fraud scheme caused an actual fraud loss of approximately $404,000,000, which it reduced to $288,395,088 after factoring in credit for collateral that federal authorities seized from Par Funding when the investigation became public in July 2020, upon the SEC placing Par Funding in receivership.
The defendant, who functioned as Par Funding’s president and CEO, his brother James LaForte, Par Funding’s “enforcer,” and Joseph Cole Barleta, Par Funding’s chief financial officer, were charged in a February 2024 amended second superseding indictment with racketeering conspiracy and related crimes.
In September 2024, Joseph LaForte pleaded guilty to the RICO charge, securities fraud, tax crimes, and perjury. He also pleaded guilty to obstruction of justice for his role in aiding and abetting James LaForte’s violent assault on one of the receivership’s Philadelphia attorneys, and to a gun possession charge for firearms found in his former residence during the execution of a search warrant.
James LaForte pleaded guilty in September 2024 to racketeering conspiracy, securities fraud, and extortionate collection of debt, as well as obstruction of justice, for his assault on the receivership attorney, and retaliation, for threatening several government witnesses. He was sentenced earlier this month to 11½ years in prison.
Barleta pleaded guilty in October 2024 to one count of racketeering conspiracy and is scheduled to be sentenced on June 2, 2025.
As detailed in court filings, the defendant served as the undisputed leader of a years-long criminal enterprise consisting of his codefendants and others. The principal purpose of this enterprise was to generate money for its leadership and members, primarily by defrauding the investors in Par Funding, which the enterprise controlled until it was placed in receivership.
Joseph LaForte and his conspirators caused false and misleading information to be conveyed to investors regarding various issues, including:
▪ Joseph LaForte’s true name, his role at Par Funding, and his criminal history;
▪ Par Funding’s underwriting process;
▪ the diversity of the company’s MCA portfolio;
▪ Par Funding’s default rate;
▪ Par Funding’s financial success and profitability;
▪ the company’s insurance; and
▪ the defendants’ self-dealing.
Par Funding’s principal means of generating income was to “advance” money to businesses (known as merchant cash advance or “MCA” customers) that were in need of short-term financing at high rates of return.
The enterprise would use threats of violence to collect money from customers whose payments were overdue. James LaForte admitted that, in threatening one particular Par Funding customer, he told the customer that he must repay the company immediately because James LaForte was not to be messed with and had previously torched people’s cars and kicked people’s teeth in.
Another Par Funding collector admitted to extorting multiple customers at Joseph LaForte’s direction, including through threats of physical harm to the customers or their families if the debt was not paid back. And as established at his sentencing hearing, Joseph LaForte also threatened and extorted customers who fell behind in their payments, such as by telling a Par Funding customer to keep paying her debts or he would bomb her car, kidnap her children, and outfit her with “cement shoes” to sink her to the bottom of the Hudson River.
The reality hidden from Par Funding’s investors was that, during every year from 2016 through mid-2020, Par Funding’s MCA business was not profitable enough to repay the money owed to Par Funding’s investors while also covering its operating expenses (including tens of millions of dollars Joseph LaForte was paying himself annually). LaForte thus needed to acquire increasingly large injections of new investor money just to keep the lights on and the business running, a hallmark of a traditional Ponzi scheme.
From 2015 until the unraveling of the fraud in mid-2020, Joseph LaForte caused Par Funding to pay him and his wife more than $120,000,000 in fraudulent proceeds, with which he purchased homes, vacation properties, vehicles, artwork, jewelry, dozens of investment properties, a boat, and a private jet. LaForte rewarded the loyalty of co-conspirators, including James LaForte and Cole Barleta, by making each of them multi-millionaires.
For years, the defendant committed a variety of tax crimes related to his fraudulent proceeds, including conspiring to defraud the IRS and filing false tax returns, as well as employment tax fraud. The total federal tax loss stemming from LaForte’s crimes exceeds $8 million. He also caused $1.6 million in state tax loss to the Pennsylvania Department of Revenue by falsely reporting that he and his wife were residents of Florida from 2013 through 2019, when in fact they resided in Pennsylvania.
“Joe LaForte is a career grifter,” said U.S. Attorney Metcalf. “He has spent his adult life lying, cheating, and stealing his way to a lavish lifestyle paid for with other people’s money. Consider LaForte’s vast criminality here: a decade’s worth of financial and tax crimes, acts of obstruction, perjury, extortionate threats, the aiding and abetting of his brother’s violent assault on an attorney, and the illegal possession of multiple guns. He has earned every day of his prison sentence. My office is committed to prosecuting these complex financial cases, to bring fraud victims some relief and the crooks who victimized them to justice.”
“Today’s sentencing holds Joseph LaForte accountable for the full scope of his criminal conduct in leading a long-running fraudulent enterprise,” said Wayne A. Jacobs, Special Agent in Charge of the FBI’s Philadelphia Field Office. “The FBI and our partners remain unwavering in our commitment to uncover, investigate, and dismantle complex financial fraud schemes — and to pursue justice and restitution for the victims they leave behind.”
“This case exemplifies how cooperative law enforcement efforts lead to the exposure of individuals and groups seeking to circumvent our laws for financial gain,” said IRS Criminal Investigation Special Agent in Charge Yury Kruty. “An investigation such as this takes a dedicated team of investigators and prosecutors many hours of hard work and sacrifice to bring to a successful conclusion.”
“Today’s sentencing brings Joseph LaForte to justice for operating a fraudulent investment vehicle that he and his co-conspirators used to generate hundreds of millions of dollars illegally, while harming Par Funding’s numerous investors,” said Patricia Tarasca, Special Agent in Charge of the Federal Deposit Insurance Corporation Office of Inspector General (FDIC OIG), New York Region. “The FDIC OIG will continue to work with our law enforcement partners to hold accountable those who deceive investors for their own selfish gain and threaten the safety and soundness of our Nation’s financial system.”
The case was investigated by the FBI, Internal Revenue Service Criminal Investigation, and the Federal Deposit Insurance Corporation Office of Inspector General, and is being prosecuted by Assistant United States Attorneys Matthew Newcomer, Samuel Dalke, and Eric Gill, as well as Assistant U.S. Attorney John J. Boscia and DOJ Trial Attorney Ezra Spiro on the tax portion of the prosecution.
The SEC in Florida investigated and litigated the civil securities fraud charges, which formed the basis of a portion of the criminal prosecution.
