Posted by Kathy Bazoian Phelps
Below is a summary of Ponzi scheme activity reported for July 2023. At least 7 new Ponzi schemes came to light this month. Over 24 years of prison sentences were imposed on Ponzi schemers. The average age of the fraudsters was about 50 years old. Please feel free to post comments about these or other Ponzi schemes that I may have missed.
Eddy Alexandre, 51, the CEO of EminiFX was sentenced to 9 years in prison and ordered to pay nearly $214 million in restitution in connection with a cryptocurrency trading scheme. Criminal authorities referred to the operations as a “massive Ponzi scheme.” An estimated 25,000 investors deposited nearly $250 million into the scheme, which targeted the Haitian community and fellow church members. Alexandre represented that investors could receive weekly returns of 5% to 9.99%.
Robert D. Christensen and Anthony M. Matic of Oregon were charged by the SEC with running a Ponzi-like scheme through Forsee Inc., The Commission PDX, LLC, The Policy PDX, LLC, and Innings 150, LLC. Investors purchased more than $10 million in promissory notes that promised interest rates between 9% and 15%. The scheme was involved in the purported investment in real estate.
Nayeem Choudry, 27, and his hedge fund, Dream Venture Capital Group LLC, of North Carolina, were sued by the SEC seeking to stop an alleged Ponzi scheme that raised at least $9.3 million from about 80 investors. Choudry promised risk-free investments in his hedge fund but in reality he lost over $4.8 million in options trading. He misused some funds and made payments to other investors of $3.5 million. A permanent injunction was entered against Choudry, prohibiting him from offering any investments in Dream Ventures.
Ryan Morgan Evans had a judgment entered against him by the SEC which resolved claims arising from the fraudulent scheme known as Saivian. Judgments had previously been entered against Eric J. “EJ” Dalius and Saivian LLC. The scheme involved the sale of “Cashback Membership” securities that entitled holders to receive 20% cash back on retail shopping purchases in exchange for paying a fee of $125 every 28 days. Evans agreed to pay $338,743 in disgorgement, interest, and penalties.
Dwight A. Foster and KEL Enterprises reached an agreement with the CFTC for permanent registration and trading bans. Foster used KEL Enterprises to solicit funds from at least 45 investors to invest in the commodities and foreign exchange market called QYU Holdings Corp.
Shawn Edward Good, 56, of North Carolina, was sentenced to 7 years and 2 months in prison and ordered to pay more than $3.6 million in restitution following his admitting to running a $7 million Ponzi scheme. Good is a former Morgan Stanley advisor who convinced his clients to borrow against their portfolios and give the money to him to invest. He instead spent the money on himself.
Richard Heart aka Richard Schueler, 43, along with his Hex token, PulseX asset trading platform, and PulseChain were charged by the SEC in an alleged Ponzi scheme that brought in $1 billion. Heart represented that investors could make 38% annual returns on Hex and that Hex was “built to be the highest appreciating asset that has ever existed in the history of man.” Heart is believed to have spent investor funds on McLaren and Ferrari sports cars, four Rolex watches costing $3.02 million, and "The Enigma," a 555-carat black diamond costing 3.16 million British pounds (then $4.28 million) at a Sotheby's auction in February 2022.
Anthony B. Liddle, 41, of Wisconsin, was sentenced to 8 years in prison in connection with a scheme run through his financial advisory firm, Prosper Wealth Management. Liddle stole more than $1.9 million from his clients by promising them returns on supposed low-risk investments. Liddle had pleaded guilty in February 2023.
Sousa Pires and Flavio Mendes Gonclaves had final judgments entered against them in connection with the cryptocurrency scheme run through EmpiresX. The judgments were entered by default and they were also ordered to pay disgorgement of over $32 million.
Carl Ruderman, 81, was indicted on charges that he defrauded investors in the 1 Global Capital Ponzi scheme. Ruderman ran up $50 million in debt before filing for bankruptcy. 1 Global Capital failed to loan out millions of dollars that the company had raised from investors after representing that funds would be deployed to small and medium-sized businesses. The scheme promised investors returns from business loans known as merchant cash advances and defrauded 3,600 investors in 42 states. Former chief financial officer Alan Heide and attorney Andrew Ledbetter were previously sentenced to 5 years each in connection with the scheme. Jan Douglas Atlas was also previously sentenced.
Brent Adam Seaman, 49, of Florida, was charged by the SEC with running an alleged Ponzi scheme that raised about $35 million from at least 60 investors. Seaman represented that he was a venture capitalist who would place investor funds with start-up technology and software companies and use the funds to trade currencies and commodities. He promised returns between 18% and 48% and that the investments were safe and guaranteed. Seaman ran the scheme through Accanito Capital Group and Surge LLC. Seaman’s wife, Jana Seaman, was also named in the complaint along with her affiliated entities, Valo Holdings Group, LLC and Surge Capital Ventures, LLC. She has agreed to pay back more than $757,000. The SEC also accused the following entities of securities violations: Accanito Holdings, LLC, Accanito Equity, LLC, Accanito Equity II, LLC, Accanito Equity III, LLC, and Accanito Equity IV, LLC.
Avinach Singh and his company, Highrise Advantage LLC, declined to settle with the CFTC along with other co-conspirators who resolved claims relating to a foreign exchange commodity pool. The scheme allegedly run by Singh brought in more than $57 million from more than 1,300 pool participants.
Reva Joyce Stachniw, 71, was sentenced to 7 years in prison in connection with a Ponzi scheme run with Ron Throgmartin through Universal Herbs LLC. The scheme ran from 2017 to 2019 and promised returns or 10% to 20% from short-term investments in cattle and marijuana. A third conspirator Mark David Ray previously pleaded guilty but has not yet been sentenced. The co-conspirators directed new investors to make payments directly to individuals who the investors were falsely led to believe were business associates. Stachniw assisted investors to make the payments through her companies, RM Farm & Livestock LLC and Sunshine Enterprises LLC.
Joseph Michael “Mike” Todd, of Florida partially settled charges brought by the SEC for defrauding at least 20 brokerage customers out of at least $3 million. The scheme was run through Todd Financial Services LLC and TFS Insurance Services LLC. Todd represented that he would invest customers’ funds in various securities but instead misappropriated the funds for her personal use and made Ponzi-like payments to conceal the scheme.
Eliyahu Weinstein aka Mike Konig, 48, of New Jersey, was arrested on allegations that he and 4 others defrauded 150 investors out of more than $35 million. Former president Trump had previously granted Weinstein clemency after Weinstein had served less than 8 years of a 24-year sentence he had received for running two other investment fraud schemes totaling more than $200 million. The others charged in connection with the scheme are Aryeh "Ari" Bromberg, 49, Joel Wittels, 57, Shlomo Erez, 55, and Alaa Hattab, 34. They solicited funds through Optimus Investments Inc. and Tyron Management Group LLC and promised returns from supposed investments in COVID-19 masks, scarce baby formula, and first-aid kits for Ukraine.
INTERNATIONAL PONZI SCHEME NEWS
Canada
Frederick Johnathon Nielsen fka Fred Gilliland was charged in connection with conduct occurring in 2018 and 2019. Nielsen has previously pleaded guilty for breaching a settlement that had banned him from the financial markets for 25 years. Nielsen had previously traded securities without being registered and had solicited more than $20 million from over 200 investors.
China
Guanhua Wang, 40, was accused of running a Ponzi scheme through Bettec Technologies Private Limited and Gamecamp Solutions Private Limited and Byrontec Technologies Private Limited. Authorities in India issued a Look Out Circular for Wang who stole money out of India through shell companies and crypto-traders.
India
Authorities searched 5 locations belonging to Hindustan Infracon India Limited in connection with a Ponzi scheme.
Kaustuv Ray was arrested in connection with his links to an alleged Ponzi scheme run through Pincon Group. Ray asserts that he was arrested wrongfully.
V Covindasamy, 66, and his wife C Lakshmi, 56, and A Justin Prabhakar, 43, were arrested in connection with the Universal Trading Solutions alleged Ponzi scheme. Covindasamy and Lakshmi are the parents of C Gowtham Ramesh, 33, who is the managing director of Universal Trading. Authorities alleged that as many as 76,000 investors were invested in the scheme.
Dinesh Kumar Singh aka Dinesh Singh Gujjar was arrested in connection with the Bike Bot alleged Ponzi scheme. The scheme was allegedly run by Sanjay Bhati, the promoter of Garvit Innovative Promoters Ltd.
Ireland
Nicholas Wickham was disqualified for 7 years from holding a directorship following a finding that he was running a Ponzi scheme through his company, Irish Gold and Silver Bullion Limited.
Nigeria
Bamishe Ajetunmobi was arrested and kept in custody in connection with N7.5 billion fraudulent scheme. Ajetunmobi ran the scheme with his wife, Elizabeth Ajetunmobi, who is still at large, through their firm, Imagine Global Solutions Limited. They offered 10% returns on investments.
Zimbabwe
Zhao Jiaotong, 39, the founder of E-Creator Electronic Commence Private Limited, and Trymore Tapfumaneyi, 32, were arrested in connection with an alleged Ponzi scheme run through E-Creator. He had fled the country with investors’ funds of about $1 million. Investors could deposit $15, $100 or $500 to receive dividends from $50 to $2,000. Others involved with E-Creator who are still at large are Justin Kuchekenya, Billy Thomas Syedou, and Abraham Mutambu. After complaints that investors could not access their funds, E-Creator posted a message on its website that it was no longer operating.
Emmanuel Chikweza was arrested in connection with an alleged Ponzi scheme he ran through Homelife Furniture and Electrical Appliance Company.
