Judge Says “Mini Madoff” Needs More Bail Money

Cosmo will remain behind bars

Accused  Ponzi schemer Nicholas Cosmo was denied bail Thursday as the circle of his potential victims grew to include as many as 17 U.S. Marines fighting in Iraq.

Two Marines just back from the war went to federal court in Central Islip to see the alleged con man they blame for wiping out their life savings.

"They believe all their money was invested," said Frank Ingrao, a Marine Reservist. "You want to go home and want everything to be good. You don't want to be concentrating on that while at war."

At a packed bail hearing, Magistrate E. Thomas Boyle demanded a "substantial" hike in the $750,000 bond Cosmo, 37, had offered before letting him out on bail. Boyle ruled that Cosmo was entitled to bail,  despite his 1999 conviction for investment fraud.

Cosmo's defense attorney, Steven Feldman, pledged to "... work with the government, as the court ordered, in an attempt to identify and agree on those terms and conditions" of bail, which Boyle said would have to include 24-hour electronic monitoring.

Cosmo, accused of cheating 1,500 investors in a $370 million Ponzi scheme, hired convicted criminals as brokers, blew $80 million in bad commodities trades and spent his victims' money on jewelry and limousines, federal officials charged. He ran Agape World Inc., and Agape Merchant Advance in Hauppauge and Queens. As of Jan. 22, the firms had only $746,000 in the bank, prosecutors said.

Some of Cosmo's cash paid for lights on a Long Island little league field, Astroturf and travel for the league's players, some players' parents said. But it's unclear whether those donations came from money clients had thought was being invested for them. Rick Barry,  an official with the league, declined to answer questions about his alleged business ties to Cosmo.

"We do not know the source of the funds used for our field and lights," Barry said. "Any donations that were made to this league were kindly accepted by the non-profit."

Authorities froze the assets of Cosmo and employees, according to court documents. Cosmo had paid millions to a network of brokers who brought in clients. One broker, Anthony Massaro, who had been convicted of heroin importation, met Cosmo while both were serving time in the federal prison in Allenwood, Pa. He went on to work for Cosmo, earning more than $5 million, officials said.

Massaro's attorney, Anthony Colleluori, said his client lost his own money, was not part of the scheme and is now being unfairly blamed by angry investors.

"I had a school teacher call and threaten his life," Colleluori said.

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