The first criminal guilty plea is expected soon against the business empire of Guy W. Gane Jr., accused nearly two years ago in a U. S. Securities and Exchange Commission lawsuit of swindling $5.8 million from investors in an alleged Ponzi scheme.

Federal prosecutors have filed court papers alleging that Lorenzo Altadonna, Gane’s vice president at Watermark Financial Services in Amherst, misled a client while selling him securities.

Altadonna will waive an indictment and plead guilty before U. S. District Judge William M. Skretny at 9 a. m. April 16, according to a filing made Monday afternoon by prosecutors.

“Mr. Altadonna has decided to plead guilty and accept responsibility despite the fact that he and his family lost money in this scheme,” said his lawyer, Lawrence J. Vilardo, “because he feels he should have behaved differently once he learned Mr. Gane’s and Watermark’s promises were not true.”

Altadonna, 35, who is married to Gane’s niece, sold securities to an investor identified only as Neil R., prosecutors said, under the guise that he was making a lucrative short-term loan to a “Greek investor,” Konstantinos Samoulidis.

In reality, said Assistant U. S. Attorney Gretchen C. Wylegala, Altadonna used some of the money to repay earlier investors, the classic framework of a Ponzi scheme.

And what about Gane, 54, who former employees said used psychics at his Amherst office to guide him in his business?

“I am not at liberty at the moment to discuss that,” Wylegala said of any possible charges against Gane.

Gane and Altadonna were the two leaders at Watermark and once had a radio program on WHLD called “Money Is Funny But It Ain’t No Joke.”

SEC attorneys accused the pair of guaranteeing investors 10 percent annual returns if they invested in condominiums in Maine and other projects. The investors later learned that there were no investments and that the two used money from later investors to pay off earlier ones.

Gane, according to those who invested with him, used his contacts in the labor movement to convince investors to trust their life savings with him.

Former workers at Gane’s office said he employed two well-known psychics, attorney James F. Lagona as the company lawyer and Ellen Bornstein (who uses the name Ellen Bourn in her psychic career) as executive director of project development.

As troubles at the company mounted, Gane, Lagona and Bourn would go into his private office and close the door, according to the workers, who said they could smell burning incense and hear “flowery” music.

Bourn said she was only a part-time employee, and Lagona did not respond to a request for comment.

When U. S. postal inspectors raided Gane’s Sweet Home Road offices in May 2008, the SEC quickly followed up with a civil suit.

SEC attorneys accused Gane of diverting $2.86 million of investor money to himself; Altadonna; Gane’s two children, Guy W. Gane III and Jenna; and others. Gane himself spent more than $321,000 on travel and meals, and an additional $79,000 for landscaping fees, the SEC alleges.

Nearly a year after the SEC suit, a Buffalo News reporter found Gane still running a business, the Covenant Network, at his office. He was selling $49 memberships to evangelical Christian congregations and offering them discount health insurance, office supplies and background checks.

That business no longer appears to be operating. The building owner foreclosed, and investors say Gane is now living in Florida with his second wife.

The only comment Gane or his lawyer have made in the investigation is what Gane told a News reporter — that he hoped to be able to repay his investors.

Attorney James W. Grable Jr., Vilardo’s law partner, earlier told The News that his client is also a victim of Gane.

“He and his family have lost money in this, too,” Grable said. “He absolutely swallowed the same story that the investors swallowed — hook, line and sinker.”