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
Whistleblowers
Debtors in Bankruptcy
Secured and Unsecured Creditors

Sunday, March 31, 2024

March 2024 Ponzi Scheme Roundup

Below is a summary of Ponzi scheme activity reported for March 2024. There were at least 12 new Ponzi schemes revealed this month. Ponzi schemers received more than 25 years of prison sentences and 4 guilty pleas. The average age of the fraudsters was about 47 years old. Please feel free to post comments about these or other Ponzi schemes that I may have missed. 

Will Allen, 36, and Susan Daub, 54, were charged by the SEC in connection with an alleged Ponzi scheme run through multiple companies under the name Capital Finance. The scheme involved $31 million, about 40 investors, and ran from 2012 to 2015, promising returns of up to 18%. Allen is a former Miami Dolphins, New York Giants and New England Patriots cornerback.

David Brend, 49, and Gustavo Rodriguez, 47, were convicted in connection with a cryptocurrency Ponzi scheme run through IcomTech. Icomtech was launched in 2018 by David Carmona, who guaranteed up to 2.8% daily profits from cryptocurrency trading and mining. Carmona, Marco Ruiz-Ochoa, and Juan Arellano have all previously pleaded guilty to the scheme.

Joseph Carvajales had a consent order entered against him in the CFTC case against both him and The W Group (WTG). Carvajales is required to pay $2.4 million in restitution and pay a $1 million civil penalty. The scheme operated from 2013 to 2020 and promised profits of up to 4% from a commodity trading algorithm. Larry Ramos Mendoza had a default order entered against him, resulting in restitution and penalties of more than $29 million. 

Jason Cloth, of Illinois, was accused of running a Ponzi scheme in a class action filed by 100 victims. The complaint alleges that the victims have lost $88 million. Cloth is a Canadian producer who allegedly ran a Ponzi-style investment scheme that exploited investors’ unfamiliarity with movie financing. A class action was filed identifying ventures affiliated with Cloth, including BRON Studios, Creative Wealth Media Finance Corp. and C2 Motion Picture Group. Cloth was also involved with a Canadian entity known as Crystal Wealth operated by Clayton Smith

Vincent Dispoto Jr., 66, of New Jersey, was charged in connection with an alleged $5 million Ponzi scheme. The scheme was run through Liberty Mortgage Services and allegedly defrauded at least 30 victims. Dispoto falsely promised to invest funds in low-risk products with guaranteed returns, such as municipal bonds and certificates of deposit.

Thomas Huling, 60, of Rhode Island, was sentenced to 8 years in prison and ordered to pay about $11 million in restitution in connection with a Ponzi scheme that he ran from 2008 to 2018. Huling promised returns from investment projects that included high-yielding bond trading platforms, a car emissions reduction technology, and an online advertising and marketing company. Instead of investing the money as promised, Huling spent it on a lavish lifestyle, including golf fees, travel, and gambling.

Siddharth Jawahar, 36, of Texas, was indicted in connection with an alleged $36 million Ponzi scheme run through Swiftarc Capital. Jawahar invested the funds in Philip Morris Pakistan. The Texas State Securities Board had issued an order revoking Swiftarc’s registration, but Jawahar failed to advise his investors of the revocation.

Samuel J. Mancini, 57, was sentenced to 5 years and 11 months in prison in connection with a Ponzi scheme in which he lured in $10.4 million from investors. Mancini ran the scheme through Outdoor Capital Partners LLC, a purported venture capital and private equity firm. That company was the managing director of OCP Italia Fund LLC, a private investment fund. Mancini promised investors returns of approximately 70% of Outdoor Capital’s operating profits. Mancini had previously pleaded guilty to the scheme.

Shane Doovan Moore, 36, of Washington, was arrested on charges that he operated a Ponzi scheme through Quantum Donovan LLC. Moore claimed he was purchasing and operating cryptocurrency mining equipment and that investors would receive 1% of their investment daily. 

Regine Norman aka Regine Ellis, 69, of New York, was sentenced to 3½ to 7 years in prison and ordered to pay $842,000 in restitution in connection with a real estate Ponzi scheme involving almost $1 million. Norman represented that investor funds would be used to purchase discounted properties at a private auction, but no properties were ever purchased.

Long Nguyen, 35, of California. was sentenced to 2½ years in prison and ordered to pay about $1.5 million in restitution for running a Ponzi scheme that defrauded at least 20 people. Nguyen had pleaded guilty last year to operating the scheme and making false statements to investors. He represented that he was a billionaire, that he had access to pre-IPO investment opportunities, and that he managed a real estate investment trust that would provide monthly income.

Gabriel Ochoa, Dulce Ochoa, Maria Saravia, Gloria Castaneda, Ismael Zarco Sanchez, Roberto Zavala, Gabriel Arguelles, Hector Aquino, Orlin Wilifredo Turcios Castro, Carmen De La Cruz, Elizabeth Escoto, Reyna Guiffaro, Marco Antonio Lemus, Juan Puac, Luis Serrano, Julio Taffinder, and Claudia Velazquez were charged in connection with a scheme run through CryptoFX LLC. The scheme promised returns of 15% to 100% and raised $300 million from investors from over 40,000 victims. The SEC charged the firm's main operators, Mauricio Chavez and Giorgio Benvenuto, in 2022. The scheme targeted the Latino community.

Pathyam Patel aka Pat Patel, 23, was arrested in Alabama on charges relating to his sale of over $4,000,000 in investment contracts through Infinity Wealth Management, an investment advisory firm. Patel guaranteed no loss to the investors’ principal investment but did not invest the funds as promised.

Joseph Pukini and Ryan Young of California are being investigated and had their homes searched in connection with an investigation of an alleged Ponzi scheme run through AB Capital. An investor alleges that over $100 million was involved in the scheme that offered first and second deeds of trust on real property.

Nicholas Salzano, 65, of New Jersey, pleaded guilty to charges relating to a Ponzi scheme run through National Realty Investment Advisors LLC that defrauded 2,000 investors out of $658 million. 

Frantz Simeon was sentenced to 2 years in prison in connection with a Ponzi scheme run through First Black Enterprises Inc. that targeted the Haitian-American community in New York. Simeon raised over $350,000 based on promises that the investment was risk-free and would generate 10% monthly returns.

Joel Wittels, 57, of New Jersey, pleaded guilty to charges that he conspired with Eliyahu “Eli” Weinstein, in connection with a $35 million scheme run through Optimus Investments Inc. and Tyron Management Group LLC. Weinstein had previously been convicted and sentenced in connection with a $240 million Ponzi scheme. Wittels hid Weinstein’s prior conviction and misused investor funds. Christopher Anderson, 47, Richard Curry, 36, and Alaa Hattab, 35, previously pleaded guilty to conspiracy to commit securities fraud and are awaiting sentencing. Charges are still pending against Weinstein, Aryeh “Ari” Bromberg, and Shlomo Erez.

Trent Witteveen, 39, of Michigan, was charged in connection with an alleged Ponzi scheme run through the timber harvesting business in the names of Titan Timber and Titans Timber LLC. Witteveen promised returns if investors provided investment capital to purchase timber harvesting rights from landowners. In most cases, no contracts for timber harvesting existed.

INTERNATIONAL PONZI SCHEME NEWS 

Argentina

Joao Felipe Costa aka Antonio Inacio Da Silva Neto, and Fabrica Farias Campos, a Brazilian couple, were arrested in Argentina in connection with a $400 million cryptocurrency scheme run through Braiscompany. The couple will be extradited to Brazil.

Australia

David Sipina pleaded guilty to charges in connection with the scheme run through the Courtenay House group of companies. Authorities have alleged that the scheme involved approximately 585 investors and $180 million. Former Courtenay House director Tony Iervasi pled guilty in 2022.

Jack Endersby, 24, was accused of running a Ponzi scheme that took in approximately $2 million from victims. Endersby promised monthly returns of 3%.

Canada

Sylvain BĂ©lair was charged on allegations that he was running a Ponzi scheme through Cosmodome. The scheme involved at least 47 investors who invested about $2 million. Patrick Boisvert has also been charged in connection with the scheme.

Chile

Alberto Change Rajii, 50, was charged in Malta on a theft crime, renewing hope among defrauded victims in an alleged Ponzi scheme run by Rajii in Chile that he will be deported from Malta to face charges in Chile. The scheme in Chile allegedly defrauded victims out of over $80 million and was run through his supposed international private equity and venture capital firm called Grupo Arcano. Rajii’s investment firm Onix promised returns as high as 1.5% per month.

England

Michael Stanley, 67, pleaded guilty to charged that was running a horse-betting syndicate known as Layezy Racing Syndicate as a Ponzi scheme. The scheme promised its 6,000 members risk-free racehorse ownership. Approximately £44 million was paid into the scheme. Stanley claimed that his system gave him an 8.17% advantage in the betting markets,

India

B Vijayaragavan, 43, was arrested as part of an investigation into the alleged Ponzi scheme run by MyV3 Media Private Limited.

Vinod Khute was accused of running a Ponzi scheme involving foreign exchange trading through VIPS Group of Companies and Global Affiliate Business Company

Ambar Dalal was charged in connection with an alleged Ponzi scheme run through Ritz Consultancy Services Company. Dalal promised 2% returns per month and defrauded over 1,000 investors.

South Africa

Prishanta Roshan Sewpaul, 27, was arrested in connection with an alleged Ponzi scheme run with Letishya Nicolette Moses, 33. They promised returns from bulk fuel sales. Moses was employed as a logistics manager for a company supplying fuel oil to ships.

Uganda

Mr Tinyefuza, 33, was charged in connection with an alleged Ponzi scheme. Tinyefuza is a real estate dealer who persuaded investors to register on an application called USwind.

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