Kathy Bazoian Phelps
Senior Counsel in Ponzi Scheme Litigation
and Bankruptcy Matters

Kathy is a senior business trial attorney with more than 30 years experience prosecuting and defending claims for high net worth clients involved in Ponzi scheme matters and in bankruptcy proceedings. Kathy’s practice includes recovering assets for clients in complex fraud cases under standard fee and alternative fee arrangements. She also handles SEC and CFTC whistleblower claims. Kathy also serves as a mediator in bankruptcy matters, in complex business disputes, and in matters requiring detailed knowledge about fraud or Ponzi schemes.

Kathy’s Clients in Ponzi Scheme Cases and Bankruptcy Matters
Equity Receivers
Bankruptcy Trustees
High Net Worth Investors
Debtors in Bankruptcy
Secured and Unsecured Creditors

Wednesday, June 5, 2013

How Many Ponzi Schemes Are There?

Posted by Kathy Bazoian Phelps

   I am often asked, "How many Ponzi schemes are there?" This is a tough question to answer with 100% accuracy because there is no central registry for all Ponzi scheme cases. The media certainly reports on the big cases, and occasionally the smaller, local cases, but most schemes go unreported as lawyers, accountants, trustees and receivers quietly unravel them.

   The Securities Exchange Commission does respond to a significant portion of Ponzi scheme cases – the ones that involve the fraudulent sale of securities. Its website reports that since fiscal year 2010, it has brought has brought more than 100 enforcement actions against nearly 200 individuals and 250 entities for carrying out Ponzi schemes. Click here.

   The website of the Commodity Futures Trading Commission also has an extensive list of the enforcement actions that it has taken in cases involving Ponzi schemes and other frauds. So far in 2013, it has published 47 press releases regarding its new and pending enforcement actions. Click here.

   Monthly, this blog summarizes the stories relating to Ponzi schemes that make the news around the globe. The reported stories include newly discovered Ponzi schemes, guilty pleas and convictions relating to previously discovered schemes, and the sentences that courts dole out to the perpetrators. Those reported stories reflect these statistics for just the first four months of 2013:

  • Over 42 people pleaded guilty or were found guilty of charges relating to Ponzi schemes involving over $1.925 billion. In addition at least 3 other individuals were charged but pleaded not guilty to charges relating to Ponzi schemes involving over $87 million.
  • Over 30 people were sentenced in connection with Ponzi schemes involving over $775 million.
  • New charges were brought in connection with newly discovered Ponzi schemes involving more than $4.35 billion.
  • Over the past year alone, millions of investors have been defrauded by Ponzi schemes.
   These are staggering statistics, with no end in sight. Anyone have any good ideas on how to stop this onslaught?

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