Greenwich Investment Advisor Pleads Guilty To Tax Evasion: Officials

GREENWICH, CT — A Greenwich investment advisor last week waived his right to be indicted and pleaded guilty to tax evasion, according to an announcement from United States Attorney for the District of Connecticut David X. Sullivan, and Special Agent in Charge of the New Haven Division of the Federal Bureau of Investigation P.J. O'Brien.

Jeffrey Arsenault, 63, pleaded guilty before U.S. District Judge Victor A. Bolden in New Haven on Dec. 17. He's released on a $50,000 bond pending sentencing, which has not yet been scheduled.

Tax evasion carries a maximum term of five years in prison.

According to court documents and statements made in court, Arsenault was the managing member and majority owner of Old Greenwich Capital Advisors LLC (OGCA), which is the investment manager of Old Greenwich Capital Partners LP (OGCP), a private equity fund of funds, officials said in a news release.

From 2013 through 2022, OGCP received investment distributions of at least $9.1 million, which should have been distributed to OGCP investors, reinvested, or used to pay authorized expenses, according to officials. Instead, Arsenault used approximately $5.2 million to pay his personal expenses or other unauthorized expenses, including payments for college tuition and golf club dues, officials noted.

From 2019 through 2022, Arsenault, through OGCA, also received approximately $2.2 million in net income for performing consulting services for third party investment firms, officials said.

Although he knew that he was entitled to only 70 percent of the net income based on his OGCA partnership agreement, officials said Arsenault kept all of it and used that money for his personal expenses.

From 2013 to 2016, Arsenault failed to report the proceeds from his embezzlement scheme on his individual federal income tax returns, resulting in income tax due and owing of approximately $1,160,161, officials said.

From 2017 through 2022, Arsenault failed to file any individual tax returns, resulting in total tax due and owing of approximately $1,002,709, officials said.

As part of his embezzlement and tax evasion scheme, from 2017 to 2020, Arsenault booked false inter-company loans between OGCA and OGCP to conceal his misappropriation of investor funds, which caused OGCA and OGCP to file false Forms 1065 and provide Arsenault false Schedule K-1s, officials said.

From 2019 to 2022, Arsenault mischaracterized and concealed from his accountants financial activity, including deposits and wire transfers into his personal bank account, which caused them to prepare false accounting records and tax returns for OGCA, officials said.

Arsenault has agreed to pay restitution of $2.16 million to the IRS, and has also agreed to pay restitution of $4.66 million to victims in a related civil case, Securities and Exchange Commission v. Jeffrey Arsenault, 3:24cv1633.