He was tried and sentenced to 27 years in federal prison as a result. John has 4 sons and currently resides in California. 1970s
In 1971, three investors in a company named Armstrong Investors amended a civil complaint in the United States District Court for the Southern District of New York, in the case of Delfino v.
Galanis was an officer
Ultimately, nine criminal actions were brought for violations of the securities laws. 1980s
On June 8, 1983, Galanis was charged, along with two former Chase Manhattan Bank vice presidents with stealing $9.5 million from Chase through fraudulent loans in 1978 and 1979.
The case was brought by Manhattan District Attorney, Robert M. Morgenthau. On May 12, 1987, Galanis was charged in separate Federal and state cases in Manhattan with stealing more than $115 million from investors and cheating the Government of millions worth of dollars in false tax deductions.
Galanis was promoting a tax-shelter.
In the Federal case, as announced by then United States Attorney Rudolph West. Giuliani in Manhattan, involved "a massive racketeering scheme" with Galanis operating a tax-shelter program that obtained about $40 million from about 2,500 investors. Giuliani called Galanis, “a career white collar criminal.” The scheme was this: Galanis’ company lent the investors $4 for each $1 they invested and told them that they were eligible to deduct four times their actual investment on their taxes. However, the loans were fabricated.
In the New York State case, Galanis was charged with selling real-estate tax shelters involving the Nashua Trust Company, which was said to be acquiring and developing non-casino hotels in Atlantic City.
None of that work ever happened. As many as 1,400 investors entrusted Galanis with $75 million.
Eddie Murphy was an investor with Galanis. On September 16, 1987, a new 58-count Racketeer Influenced and Corrupt Organizations Acting (RICO) indictment was served to Galanis, along with eight others, for a Greenwich, Connecticut-based racketeering enterprise.
Here, Galanis’ company took control of three mutual funds in Oakland, California, Inter-Services Intelligence Trust Fund, Inter-Services Intelligence Growth Fund and Inter-Services Intelligence Income Fund.
Galanis was accused of obtaining $3.9 million by selling the funds securities at inflated prices and also fraudulently obtaining control of the Columbia Federal Savings Bank of Westport, Connecticut through lying to the Federal Home Loan Bank Board. On September 29, 1988, Galanis was ultimately sentenced to 27 years in a Federal prison for 44 counts of involvement in a racketeering enterprise after being convicted in July 1988. He stated at his sentencing,
In 2001, Galanis was released from prison on a work release program and disappeared.