Steven and Lori Palladino and their son Gregory are now charged with defrauding customers of their Centre Street investment firm of up to $13.8 million, the Suffolk County District Attorney's office reports.
The three were arraigned today in Suffolk Superior Court on charges levied by a grand jury last month. Prosecutors had previously said the family was responsible for $10 million in losses.
Prosecutors allege the three ran a Ponzi scheme in which they took money from later investors to pay off initial investors, but mostly just moved money to private accounts to pay for such things as luxury cars, hundreds of thousands of dollars in gambling debts and a mistress for Steven Palladino.
In addition to their Viking Financial Group, the family owns the iScream ice-cream parlor on the ground floor of the building that housed Viking, as well as a renovated building on Spring Street rented to a hair salon.
Steven Palladino faces a separate charge of usury for allegedly trying to force a local business owner to repay a loan at a prohibited 40% rate.