Indictment charges Greenwich investment group operator

Date: Nov. 5, 2024

Contact: [email protected]

Vanessa Roberts Avery, United States Attorney for the District of Connecticut, Robert Fuller, Harry T. Chavis, Jr., Special Agent in Charge of IRS Criminal Investigation (IRS-CI) in New England, and Special Agent in Charge of the New Haven Division of the FBI, today announced that a federal grand jury in New Haven has returned a 23-count indictment charging Justin C. Murphy of Stamford, with offenses stemming from an alleged investment fraud scheme.

The indictment was returned on September 22, 2022. Murphy, who was extradited from Brazil, appeared on November 1, 2024, before U.S. Magistrate Judge Thomas O. Farrish in Hartford, pleaded not guilty to the charges, and was released on a $250,000 bond. Murphy had been detained in Brazil since his arrest on December 6, 2023.

As alleged in the indictment, Murphy owned and operated Greenwich-based Mara Investment Group, LLC, also known as Mara Investment Management LP and Mara Investments Global Management LLC ("Mara"), which Murphy purported to be a hedge fund that solicited and accepted investments and used a quantitative strategy that balanced long and short positions in securities. Between approximately 2016 and September 2022, Murphy defrauded investors by pursuing a much riskier investment strategy than he told investors; diverting substantial investor funds for his own personal use and benefit; representing to investors that their invested funds were performing more favorably than was, in fact, the case, including providing investors with account statements that falsely representing their account balances; and providing investors with federal tax forms that falsely reported business income upon which investors would be required to pay tax.

It is alleged that Murphy stole approximately $3.5 million in investor funds through this scheme and used the funds to pay for personal expenses and to purchase a personal stake in his relative's startup company.

The indictment charges Murphy with 15 counts of wire fraud, an offense that carries a maximum term of imprisonment of 20 years on each count; five counts of money laundering, an offense that carries a maximum term of imprisonment of 10 years on each count; and three counts of tax evasion, an offense that carries a maximum term of imprisonment of five years on each count. Per the extradition agreement with Brazil, the government has agreed not to pursue the tax evasion charges against Murphy.

U.S. Attorney Avery stressed that an indictment is not evidence of guilt. Charges are only allegations, and the defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This investigation is being conducted by the Internal Revenue Service Criminal Investigation and the Federal Bureau of Investigation. The Justice Department's Office of International Affairs and Brazilian authorities provided assistance.

The case is being prosecuted by Assistant U.S. Attorney David E. Novick.

IRS-CI is the criminal investigative arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money-laundering, public corruption, healthcare fraud, identity theft and more. IRS-CI special agents are the only federal law enforcement agents with investigative jurisdiction over violations of the Internal Revenue Code, obtaining a more than a 90 percent federal conviction rate. The agency has 20 field offices located across the U.S. and 12 attaché posts abroad.