August 2018 Ponzi Scheme Roundup

Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for August 2018. The reported stories reflect at least 7 new Ponzi schemes worldwide; about 20 years of newly imposed sentences for people involved in Ponzi schemes; 2 guilty pleas or convictions, and an average age of approximately 53 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. 

Arthur Lamar Adams and Madison Timber Properties LLC were the subject of an SEC complaint accusing them of running a multi-million dollar Ponzi scheme. Adams had previously pleaded guilty to charges brought in Mississippi. Investors were told their money would be used by MT Properties to acquire timber-harvesting rights from landowners. Investors were promised returns of 12% to 15%. More than $100 million was invested by more than 250 investors. Adams’ sentencing in his criminal case has been delayed until October.

Michael D’Alessio, 52, was arrested on charges relating to an alleged Ponzi scheme in New York. Alessio sold investments for real estate projects through his firm, Michael Paul Enterprises. Instead of generating promised returns, however, Alessio use the funds to pay his own debt, to gamble and for other personal expenses.

Jerome H. Cohen, 63, and his son, Shaun D. Cohen, 39, were sued by the SEC in connection with an alleged $135 million Ponzi scheme run through Equitybuild Inc. and Equity Build Finance. The scheme allegedly defrauded about 900 investors and promised returns of 12% to 20% from a real estate scheme that supposedly identified undervalued property. EquityBuild is a Florida corporation with an office in Chicago and solicited funds from investments in Chicago real estate projects. 

John “Jack” William Cranney, 77, of Texas was sentenced to 5 years in prison in Massachusetts and ordered to pay more than $5.5 million in restitution in connection with a $6 million scheme that defrauded 15 investors. Cranney created shell companies and convinced victims to transfer their IRA and 401k retirement funds to him, including Employee Stock Ownership Plan. He spent the money on personal expenses and to prop up his failing nutrition products distributorship.

Randall Alan Finer, 55, pleaded guilty to running a Ponzi scheme in Iowa. Finer raised $887,700 from investors for his day-trading operation but used more than half the money on personal expenses and to pay promised returns to earlier investors.

Gilbert Fluetsch, 52, was barred by the SEC from the securities industry. Fluetsch was the chief operating officer of California-based Hoplon Financial Group and was alleged to have assisted Daniel B. Vazquez Sr., the company’s owner, in creating the New Economic Opportunities Fund I, or NEON. The Fund was to pool investor funds to purchase and flip real estate. They sold membership units in the fund totaling $2.18 million to 27 investors. The funds were misused on unrelated business or personal expenses.

Michael James Frew, 70, was indicted in Nevada on charges that he ran a real-estate related Ponzi scheme. Investors understood that Frew would invest their funds in real estate in the United States and abroad, but Frew instead spent the money on personal expenses, to speculate in the stock market, and to repay earlier victims a portion of their investment.

Evan Greebel, 45, was sentenced to 18 months in prison and ordered to pay $10 million in restitution for his role in the scheme run by Martin “Pharma Bro” Shrekli. Shrekli was previously found guilty of securities fraud for running a Ponzi scheme involving his biotechnology company Retrophin Inc. Greebel was outside counsel for Retrophin and was found guilty of scheming with Shkreli to commit fraud.

Barry M. Kornfeld, Ferne Kornfeld, Lynette M. Robbins, Andrew G. Costa, Albert D. Klager and their companies, including Knowles Systems Inc., were sued by the SEC and accused of selling retail investors more than $243 million in unregistered securities in Woodbridge Group of Companies LLC to more than 1,600 investors. Woodbridge was allegedly running a $1.2 billion Ponzi scheme. Robbins was the highest-earning external agent of Woodbridge, receiving at least $8.1 million in commissions.

Hector May, 77, was accused of running a Ponzi scheme that stole millions of dollars from a company’s pension plans. May was a financial adviser whose advisory firm, Securities America, operated as Executive Compensation Planners.

Edward Lee Moody Jr., 47, and his Virginia-based company, CM Capital Management LLC, were sued by the SEC, claiming that Moody embezzled over $2 million and paid out $1.4 million in a Ponzi-like fashion. 

John K. Moore aka Kevin Moore was found guilty of running a Ponzi scheme in Montana. Moore had been charged with defrauding 36 investors out of $2.7 million through his mining company called Big Sky Mineral Resources and a fine art investment company called Glacier Gala. Moore had previously been convicted in the late 1980s for defrauding a victim out of $75,000 in a gold coin scheme.

Daniel Rivera, 48, was indicted in New Jersey on charges that he ran a scheme through a company called Robbins Lane Properties, Inc. Rivera, a financial advisor, misrepresented that the company employed real estate professionals who would use the investments to fund real estate ventures. The investors were promised monthly returns based on “secure real estate investments in the company’s portfolio.” Rivera spent the money on personal expenses and his child’s tuition and sorority fees.

Brandon Walton Stewart, 33, pleaded guilty to charges that he ran a $13.5 million Ponzi scheme. Stewart was arrested in Dallas and extradited back to Orange County, California. He had promised investors that he would invest their money in stocks such as Facebook, but he instead spent the money on himself.

Cory Ryan Williams, 40, of Arizona, was sentenced to 7 years in prison for running a Ponzi scheme that brought in about $13 million from about 50 victims. Williams promised investors returns of 5% weekly but he lost more than $8 million in trading stock futures. Williams and his company, Williams Advisory Group, were previously charged by the CFTC with running a commodity futures fraud, promising to invest funds using his expertise and based on his supposed profitable past.

INTERNATIONAL PONZI SCHEME NEWS 

Canada

Authorities have alleged that Todd Norman John Bezzasso, Bezzaz Holdings Group Ltd., Nexus Global Trading Ltd., Wei Kai Liao aka Kevin Liao, and Florino Corsi, were running a fraudulent investment scheme. Bezzasso was the sole director and officer of Bezzaz and Nexus, Liao was a finder for Bezzaz, and Corsi was a finder for Bezzaz and Nexus. About $5 million was raised from about 85 investors who were promised monthly returns in various investments. The returns promised ranged from 5% to 30% for periods of one to 6 months.

China

Linlijia Commerce and Trade wound up all of its stores when its sole investor, Shanlin Shanghai Financial Information Service, was busted for running a Ponzi scheme. Shanlin was running a peer-to-peer lending operation and when its accounts were frozen it was no longer able to inject cash into Linlijia’s accounts.

England

Freddy David, 49, was sentenced to 6 years in prison. He admitted to stealing about $19 million from about 55 people in a Ponzi scheme by selling them fake investments through HBFS Financial Services, a wealth management company. David targeted mostly Jewish victims from his synagogue. The rabbi of the congregation apologized for calling David up to read a blessing, not knowing that David had defrauded members of the congregation. David lost much of the money on gambling websites.

India

Ganesh Hazare, the director of Atharva4U Infra and Agro Pvt Ltd., and Shivaji Nikale, the managing director, were arrested in connection with an alleged Ponzi scheme run through the companies. The scheme promised investors that they would double their money in a period of 5 years, triple their money in 7 years, and make 4 times their money in 10 years. 

The Ponzi scheme run through GainBitcoin saw two more suspects arrested. The scheme defrauded victims out of $150 million. The individuals had close ties to Amit Bhardway, the individual who started GainBitcoin.

Divyesh Darji was arrested upon his arrival from Dubai for his role in the Bitconnect scheme. Darji is the Asia head of the scheme which was shut down by regulators in Texas and North Carolina.

Gardas Ramesh and four others were arrested at the premises of GRM Estates on charges that they defrauded over 1,200 investors out of $1.43 million in a Coinx Trading cryptocurrency scheme.

Taiwan

Thirteen executives and employees of Maxim Trader Group were found guilty of defrauding investors out of about $453 million. The firm was supposedly engaged in foreign exchange trading and other investment opportunities and promised investors between 3% and 8% per month, and as much as 98% per year. About 50,000 people from Taiwan, Southeast Asia, Hong Kong, China, Japan, South Korea and Australia invested with the company before it collapsed in 2015. Chang Chin-su, the chief executive, was sentenced to 11 years in prison, and Chia Hsiang-chieh, the chief assistant, was sentenced to 9 years. Chang’s sister, Chang Mu-tan, was sentenced to 5 years. Maxim had claimed that it was an affiliate of Royale Globe Holding, a NASDAQ-listed company. Malaysian authorities earlier this year indicted Andrew Lim Ann Hoe, the chief executive of Maxim Capital, and company executives Chin Ming Kam and Goh Seow Mooi on charges relating to a scheme known as the Maxim Trader Compensation Plan. Malaysian investigators estimated that 50,000 investors around Asia had lost a total of US $5 billion.

Thailand

Officials in Thailand are seeking the extradition of four Singapore citizens believed to be involved in the Eagle Gates Group Ponzi scheme. The scheme has resulted in losses of about $9.8 million and 250 Thai and foreign investors. U.S. national, Derrick Matthew Keller, has been detained as an alleged accomplice and has admitted that he was an actor that was hired by the CEO of Eagle Gates to deceive investors in China, Hong Kong, Macau, Malaysia and Thailand.

Uganda

Charles Nwabuikwu, 44, was arrested on charges that he ran a Ponzi scheme through Development Channel that defrauded Ugandans. The company described itself as “the world’s most comprehensive platform for increasing access to basis development needs between the developed and under developed countries and communities.” 

The Bank of Uganda released a statement cautioning the public against investing in businesses which sound too good to be true. The Bank stated that if a business guarantees high returns with little risks of losing the investment, it is false. 

NEWSWORTHY LEGAL ISSUES IN PENDING PONZI SCHEME CASES

City National Bank agreed to pay $33 million to settle claims that it aided and abetted a Ponzi scheme run by Nationwide Automated Systems Inc. The scheme involved the sale of ATM machines to investors who were promised $.50 from each ATM transaction.

About $16 million is being distributed in the Thomas Petters Ponzi scheme case.  The payments will go to about 360 investors.

Proskauer Rose LLP and the receiver in the R. Allen Stanford $7 billion Ponzi scheme reached a $63 million settlement of claims against the law firm in connection with the scheme. The firm admits no wrongdoing in the settlement.

A putative class of investors settled with United Development Funding IV to resolve claims that the company and covered up its “Ponzi-like” nature.  The settlement is for $13.5 million.

July 2018 Ponzi Scheme Roundup

Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for July 2018. The reported stories reflect at least 10 new Ponzi schemes worldwide; over 40 years of newly imposed sentences for people involved in Ponzi schemes; 3 guilty pleas or convictions, and an average age of approximately 53 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed.

Michael R. Casey, 71, faced charges in Texas that he defrauded 700 people through an online commodities business called Commodities Online LLC that allegedly ran a $19 million Ponzi scheme.  Casey had been on the run for 4 years. He had first worked as outside counsel for the business and later became its president. Investors were promised returns of 33% to 35%.

Dillon Dean, 26, was fined $1.9 million for defrauding about 600 investors in a Bitcoin scheme. A court in New York ordered a default judgment against Dean and his company, The Entrepreneurs Headquarters Limited, finding that they engaged in a fraudulent scheme involving Bitcoin. Dean, who has disappeared, claimed that investors could earn returns between 15% and 50%. Starting in August 2017, Dean claimed that his site had been hacked and he stopped paying returns. Meanwhile, Dean started another website called “Real Trade Profits,” which also solicited investments in Bitcoin.

Sergio Delmico and his companies MNV Energy LLC and MNV-K LLC were sued by a group of investors accusing the gas station operators of running a fraudulent scheme. Wellington Siqueira Vilela and Ricardo Botos da Silva Neves were also named in the lawsuit. The defendants are alleged to have been running a Ponzi scheme, which promised investors 1% returns per month from the gas station operations.

Francisco Plascencia Esparza, 46, was sentenced to 6½ years in prison in connection with a $12 million real estate Ponzi scheme. Esparza previously pleaded guilty to the scheme in which he told investors he would be acquiring real estate with their funds. About 70 investors were defrauded in the scheme.

Carolyn Grant, 63, was sentenced to 6½ years in prison in North Carolina and was ordered to pay restitution of $13.5 million for her role in a Ponzi scheme that defrauded more than 65 people out of $13 million.

Bobby Eugene Guess, 66, was sentenced to 12 years in prison for his role in a $6 million Ponzi scheme. The scheme defrauded investors by promising them returns from an internet advertising company. Guess hosted a radio show called “Dollars & Sense” and held investment seminars.

Cameron J. Hager, 42, pleaded guilty to charges in connection with a $4.7 million Ponzi scheme relating to the sale of cattle. The scheme, run in Missouri, defrauded 89 investors through a business called 5A Holdings, LLC. Investors understood that their funds would be used to purchase herds of cattle that Hager said he could sell for substantial profit. Investors were promised returns of 23% to 28%.

Michael Kwasnik, 48, formerly of Kwasnik & Associates, and his father, William Kwasnik, 69, were ordered to pay $36.88 million to the New Jersey Fund for Client Protection and the Pennsylvania Lawyers Fund for Client Security. Both men have been charged with operating a Ponzi scheme and diverting money to their business entities, including Liberty State Financial Holdings Corp., Liberty State Benefits of Delaware, Liberty State Insurance Services, Oxbridge Investors Fund, OPIS Management Fund and Capital Management of Delaware. About $13 million was taken from about 40 clients.

Luxe Vacation Homes and its owner, Justin Steubs, have been accused of running a rental Ponzi scheme, using current rental income to pay off future rentals. The company was an agency that rented out short-term rentals for homeowners in Palm Springs, California. Luxe was taking money from future rentals to pay off current rentals.

Edward Lee Moody, Jr., 47, and CM Capital Management LLC were charged with defrauding 60 investors in a $4.94 million Ponzi scheme in Virginia. The SEC is also seeking disgorgement from G.E. Holdings, a company allegedly controlled by Moody.

Vance Moore II, 64, was arrested in connection with an alleged Ponzi scheme run with co-defendant, Walter Netschi, 62. The scheme involved $80 million in an ATM scam in which investors believed they were buying automated teller machines to be placed in convenience stores, shopping centers, hotels and other locations. Investors believed that Moor and Netschi had 4,000 machines when in reality they only had about 400. Moore’s company, ATM Financial Services, would supposedly process, operate and maintain the machines.

Steven Pagartanis, 58, was arrested on charges that the he ran a real estate related Ponzi scheme for more than 18 years. The scheme allegedly defrauded at least 17 victims by promising them 4.5% to 8% annually. The victims, mostly elderly women, invested over $13 million and sustained losses of over $8 million. The money was supposed to be invested in Genesis Land Development, a publicly traded company based in Canada, but Pagartanis instead invested the money into a shell company that he controlled called Genesis I Holdings.

Daniel B. Rudden, 71, confessed to running a $55 million Ponzi scheme through his business, Financial Visions. The scheme promised returns of 12% from supposed funeral funding services to more than 600 funeral homes and cemeteries. About 150 investors were defrauded in the scheme. Rudden was subsequently arrested in Colorado. The SEC then froze the assets of a group of companies operating under the Financial Visions name.

Perry C. Santillo Jr., First Nationale Solution LLC, Christopher Parris, Paul Anthony Larocco, John Piccarreto, Thomas Brenner, Percipience Global Corporation, and United RL Capital Services were sued by the SEC and accused of running a Ponzi scheme that defrauded 637 investors. The scheme allegedly defrauded investors by falsely representing that their funds would be invested in in fields such as financial services, insurance, real estate development, and medical laboratories. Some of the assets frozen in connection with the alleged $102 million Ponzi scheme were unfrozen when found to be part of a separate business.

Sherman C. Vaughn Jr., 47, was ordered to forfeit $8 million generated by him and former Philadelphia Eagles linebacker Merrill Robertson Jr., 38, in a Ponzi scheme run through Cavalier Union Investments LLC.

Kevin Wanner, 56, was sentenced to more than 11 years in prison in connection with a Ponzi scheme he ran through Questar Capital Corporation dba Precision Financial. Wanner defrauded 66 investors in North Dakota by selling fictitious brokered certificates of deposits and unregistered interests in pooled investments.

INTERNATIONAL PONZI SCHEME NEWS

Canada

Timothy Ray Carruthers, 59, was charged with running a fraudulent scheme through Wakina Consulting Inc.  The scheme involved $5.5 million in what has been labeled as a mortgage Ponzi scheme. It is alleged that Carruthers facilitated 257 fraudulent loans, promising investors monthly interest payments and administration fees on the loans.

England

Freddy David was sentenced to 6 years in prison for defrauding 55 victims out of £14.5 million in a Ponzi scheme. David, a wealth manager, pleaded guilty to defrauding his victims by promising them 8% interest per year when their money was locked in a bank account for 3 months to 5 years. 

Germany

Jörg Biehl, 56, was sentenced to 8 years in prison in connection with a Ponzi scheme run through 22 companies known as the Infinus Group. Biehl was accused of defrauding 22,000 investors out of $375 million, although it is believed that the scheme involved more than 50,000 investors and €2 billion. Infinus started in 2001, buying life insurance policies and offering the owners improved surrender values. The money that was freed up as a result was then invested in other products offered by Infinus, such as fixed-interest bonds, registered bonds, and profit participation rights.

India

The offices of Pailan Group and the home of Apurba Saha were raided by authorities after the company was accused of running a Ponzi scheme.

Regulators claim that Heera Islamic Business Group, aka Heera Gold, were running a Ponzi scheme.  Heera Gold is headed by Dr. Aalima Shaikh Nowhera and the company claims to be a gold trading company with businesses all over the world. The company targeted the Muslim community, promising high returns and making references to “Allah” to convey a devout image to investors.

Amit Bhardwaj, the promoter of the GainBitcoin scheme who is currently in prison, has offered to pay investors back their principal investment. There are over 100,000 investors who were promised monthly returns of 10%. The victims have demanded that they be compensated in an amount equal to the value of the bitcoins today.

Charges were filed against the directors of Samruddha Jeevan Multi-State Multi Purpose Co-operative Society Ltd, Mahesh Kisan Motewar and Prasad Kishor Paraswar. The scheme promised to provide cattle and goats as well as high rates of return to investors.

New Zealand

Lance Jack Ryan aka Lance Jared Thompson, 44, and Jimmie Kevin McNicholl, 56, were convicted in connection with a Ponzi scheme that defrauded 900 investors. Ryan was sentenced to 7½ years in prison while McNicholl received 11 months’ home detention and community service. The scheme was run through BlackfortFX and promised returns from a “straight through processing” foreign exchange trading platform.

Thailand

Chinnawat Noiwan was arrested in connection with a scheme he operated through OD Capital. It is believed that 500,000 people may have been defrauded in connection with the scheme. 

Turkey

The founders of Turcoin, an alternative digital currency, were arrested. Sadun Kaya and Muhammed Satiroğlu were arrested after the scheme involving $211 million was revealed to be a Ponzi scheme. Turcoin was established by Hipper and stopped paying returns in June. Satiroğlu denies the claims and stated, “I have not fled with the money. I will return all the money to the members if authorities unblock my bank accounts. Actually they are the ones who are involved in serious corruption.”

NEWSWORTHY LEGAL ISSUES IN PENDING PONZI SCHEME CASES

A class action against JPMorgan Chase & Co. was settled for $4.6 million in connection with the Ponzi scheme run by William Wise. Almost 200 investors alleged that JPMorgan overlooked suspicious activity in connection with the scheme, accusing it of aiding and abetting the scheme run from Millennium Bank.

YouTube was added as a defendant to a class action lawsuit against BitConnect. Thousands of investors were reached through YouTube, and YouTube was accused of failing to protect its users from BitConnect-promoting content, by not delisting and demonetizing videos about it. Reports state that the scheme’s promoters posted over 70,000 hours of BitConnect-related content on YouTube, which received over 58 million views. Google, Facebook and Twitter have all banned crypto-currency-related ads.

JPMorgan Chase & Co. was accused by investors of aiding and abetting a Ponzi scheme run by Renwick Haddow. The investors in Bar Works Inc. claim that the bank turned a blind eye to the scheme. Haddow, who identified himself as Haddow, then used a fake alias, Jonathan Black, to raise funds from investors. Haddow solicited investments in start-up companies he created, including Bitcoin Store (a purported online platform for Bitcoin trading) and Bar Works (an entity that claims it was adapting former restaurants and bars into co-working spaces). The investments were solicited through InCrowd Equity, Inc., which claimed it was a crowdfunding portal through which investors could purchase shares. 

A proposed class of investors reached an $18.5 million settlement with the law firm Tonkton Torp LLP in connection with the scheme run through Aequitas Management LLC.

June 2018 Ponzi Scheme Roundup

Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for June 2018. The reported stories reflect at least 9 new Ponzi schemes worldwide and an average age of approximately 51 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. And please remember that I am just relaying what’s in the news, not writing or verifying it.

Matthew Eckstein, 48, was charged in connection with an alleged $5 million Ponzi scheme that defrauded 14 people. Eckstein ran the alleged scheme through Conmac Funding, promising a risk-free investment at 4% over 2 years. Eckstein is a financial advisor who started Sisk Investment Services Inc. in 2015, but used the money to fund other business enterprises or for his personal use, rather than investing into Conmac Funding. Eckstein pleaded not guilty.

Randall Finer, 54, pleaded guilty to charges relations to a Ponzi scheme run in Iowa. The scheme brought in more than $800,000, and he is accused of diverting 52% of the money into his own accounts for living expenses.

Jesse Harris and his company Harris Custom Projects were the subject of an asset freeze sought by the Kansas Securities Commissioner who alleged that Harris was running a $5.5 million Ponzi scheme. Harris used investor funds to purchase a house, car and furnishings for his home.

James E. Hocker, 48, was charged by the SEC in connection with an alleged Ponzi scheme that promised investors 10% to 30% returns from an insurance scheme. Hocker promised guaranteed returns from investments he would supposedly make on the investors’ behalf in the S&P 500 and other investment vehicles. Hocker was selling insurance products and annuities under the name James E. Hocker & Associates. The investors withdrew money from their life insurance policies or retirement accounts to invest with Hocker. Hocker raised approximately $1.27 million from about 25 investors.

Ralph T. Iannelli and his leasing company, Essex Capital Corp., were accused by the SEC of running an $80 million Ponzi scheme. The scheme involved 70 investors and promised them returns of 8.5% to 10%. Essex Capital was supposedly going to use 100% of investor funds to purchase equipment and investors would be paid back within 3 years. The SEC alleged that Essex only spent about 9% of the capital raised from investors and through bank loans.

Brian D. Jones, 38, pleaded guilty to charges that he ran a Ponzi scheme in connection with his cattle broker business in Indiana. Jones took $473,000 from his victims, promising them large returns from the buying and selling of bull calves from dairy farms in Wisconsin to cattle ranches in Texas and Missouri. Jones used investor funds from gambling and his personal benefit.

Mitchell Klein faced sentencing in connection with a Ponzi scheme that defrauded investors out of $60 million. Klein had pleaded guilty in February to running the scheme with John Magee and Burton Dorfman through FKF 3 LLC. Magee and Dorfman were not charged in the case.

Alex Reaves Lundin, 26, was sentenced to 2 years in prison in connection with her role in a Ponzi scheme run by her husband, Jeremy Lundin. Jeremy Lundin previously pleaded guilty to the scheme he ran through Big Island Capital in which he defrauded at least 51 people out of $1 million. Alex Lundin assisted her husband in soliciting new investors and assuring investors that their funds were safe.

Billy Wayne McClintock, 76, was sentenced to 10 years in prison for his role in a Ponzi scheme that brought in more than $20 million  from over 220 investors in Minnesota. McClintock ran the scheme with Diane Alexander, and they offered investors 38% annual returns from supposed investments in Europe.

Perry Santillo, 38, and Christopher Parris, 38 were charged along with Paul Anthony LaRocco, 55, John Piccarreto, 34, and Thomas Brenner, 55, in a civil lawsuit brought by the SEC with running a $102 million Ponzi scheme that defrauded 637 investors. Santillo and Parris would “buy or take over books of business of retiring investment professionals from around the country.” The other three defendants would then persuade clients to withdraw their money and invest in First Nationle Solution, Percipience Global Corp., and United RL Capital Services. Santillo used at least $13.4 million fund a lavish lifestyle. Investors have sued Bank of America along with the five individuals for allegedly aiding and abetting the $102 million scheme. 

Carl Frederic Sealey, 43, pleaded guilty to running a $1.6 million Ponzi scheme through Global Standard Industries Inc. and SEK Industries Inc. Sealey is a Philadelphia investment adviser who used investors funds to fund his own lavish lifestyle instead of using the money to finance real estate deals. Sealey claimed to have more than $15 billion in domestic assets and another $33 billion offshore. Investors were told their investment was risk-free and they would get their money back in 90 days. When there was a delay, they were told they could get their money back more quickly if they invested additional funds for other deals.

Carlos Uresti, 54, was sentenced to 12 years in prison and order to pay $6.3 million in restitution. Uresti, a Texas senator who was convicted on charges relating to a Ponzi scheme run with co-defendant Gary L. Cain, resigned from his senate seat in advance of his sentencing. Cain was sentenced to more than 5 years in prison. A jury found Uresti and Cain guilty in connection with the fracking enterprise run through FourWinds Logistics. FourWinds CEO Stanley P. Bates pleaded guilty earlier this year.

James VanBlaricum and six others were charged by the SEC in connection with an alleged oil and gas Ponzi scheme in Texas. The alleged scheme was run through Texas Energy Mutual LLC fka Texas Energy Management. Also included in the complaint were Rodney Pope, Chet Inglis, Robert  Gilliam, Matthew Leaverton, William Hill and Erik Rhodes. The complaint alleges that the defendants raised over $10 million by guaranteeing returns from the use of their funds to drill oil wells.

Thomas Michael White, 59, John Kevin Reech, 56, and Joseph Mario Genzone, 53, were indicted in Miami on charges relating to an alleged Ponzi scheme. The three defendants alleged solicited investors to buy shares of stock in First Call Ventures LLC and its subsidiaries, promising investors a 100% return and that their money was safe.

INTERNATIONAL PONZI SCHEME NEWS 

Australia

Poker professional William “Billy” Jordanou, 59, pleaded guilty to charges that he ran a $72 million Ponzi scheme, along with Robert Zaia, 54. Jordanou admitted to using forged documents to receive loans from clients to supposedly fund property development.

Canada

Rashida Samji was ordered to surrender herself following dismissal of her appeal on her conviction on charges that she defrauded nearly 284 investors in a $110 million Ponzi scheme. She was sentenced to serve 6 years in prison.

Cambodia

Authorities warned of risks of buying, selling or trading cryptocurrencies without getting a license. They warned investors of potential losses due to the volatile nature of cryptocurrency as well as the risk of hacking.

Cayman Islands

A Cayman Islands court dismissed rival claims made by a Saudi Arabian family and a Kuwaiti-born businessman, finding that both sides defrauded banks out of about $126 billion in a Ponzi scheme. The al-Gosabis and Maan al-Sanea blamed each other for their losses.  Ahmad Hamad al-Gosabi and Brothers (AHAB) and Saad Group are owned by al-Sanea, had sued each other for fraud relating to a Ponzi scheme run through a unit of AHAB known as the Money Exchange. Sanea had married into the al-Goasbi family and was managing director of Money Exchange. The al-Gosabis allowed al-Sanea to use the Money Exchange for “massive personal borrowing.” The Money Exchange had raised about $126 billion by fraudulently borrowing funds from at least 118 banks around the world.

India

Authorities detained Tah Kazi in connection with a cryptocurrency Ponzi scheme run through Finstone Group, called Money Trade Coin (MTC) estimated to have involved around Rs 300 crore to Rs 500 crore.  The director, Amit Lakhanpal, absconded along with four others. The scheme promised investors ten-fold returns in 5 to 6 months.

Authorities attached 47 properties of Royal Twinkle Star Club and Citrus Check Inns Ltd. The promoter of the scheme, Om Prakash Goenka, is currently in prison.

Authorities began searches of the offices of Atharva 4 U Infra and Agro Pvt Ltd. in connection with an alleged Ponzi scheme. The scheme promised investors that they could double their money from investments in construction, travel and tourism, educational institutions, hotels and resorts. Shivaji Niphade, Ganesh Hajare, Sachin Gosavi and Mukesh Sudesh are all named in the scheme.

Six people were charged in connection with an alleged crypto Ponzi scheme run through NCR Coin LLP. The director of the scheme, Rohit Kapopara, allegedly devised a fake kidnapping and said that all of the company’s digital holdings had been acquired by a kidnapper.

Turkey

Turcoin, an alternative digital currency, was revealed to be a Ponzi scheme. Turcoin was established by Hipper, which was founded by Muhammed Satiroğlu and Sadun Kaya. The scheme stopped paying returns in June and the Hipper executives left Turkey with 1 billion Turkish Lira ($211 million). Satiroğlu has joined investors in suing Kaya, alleging that his partners, and not he, stole the money. Kaya is also involved with Anafis, Inc., another company involved in the scheme.

NEWSWORTHY LEGAL ISSUES IN PENDING PONZI SCHEME CASES

The trustee of the Bernard Madoff Ponzi scheme reached a settlement with J. Ezra Merkin and his two funds, Ascot Partners LP and Ascot Fund Ltd., along with Gabriel Capital Corp. Merkin and his companies, who lost money in the scheme, are to pay $280 million and will be allowed a $502 million claim in the case. The distribution, however, will be used to fund the settlement.

JPMorgan Chase agreed to pay $4.6 million to settle a proposed class action that accused the bank of aiding the Millennium Bank Ponzi scheme run by William Wise. Investors allege that JPMorgan allowed Wise to steal millions of dollars from accounts held at the bank despite numerous signs that he was running a fraud.                        

May 2018 Ponzi Scheme Roundup

Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for May 2018. The reported stories reflect at least 15 new Ponzi schemes worldwide; 5 convictions and guilty pleas; over 26 years of newly imposed sentences for people involved in Ponzi schemes; and an average age of approximately 55 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. And please remember that I am just relaying what’s in the news, not writing or verifying it.

Arthur Lamar Adams, 58, was charged in connection with his role in a Ponzi scheme in Mississippi. Adams pleaded guilty and admitted his company was a Ponzi scheme. The scheme was run through Madison Timber Properties LLC, Madison Timber Fund LLC, and Madison Timber LLC. More than $100 million was invested by more than 250 investors from at least 14 states. The criminal charges were filed after the SEC filed its lawsuit. Adams allegedly falsely represented that Madison Timber Properties was in the business of buying timber rights from landowners and then selling those rights to lumber mills at a higher price. Only a few such timber rights or contracts existed. The investors were guaranteed returns of 12% to 13%. The SEC then filed an action to appoint a receiver over the assets of Adams.

Kenneth Brewington, 53, of California was convicted on charges relating to a $3 million Ponzi scheme run through Compass Financial Solutions. Brewington and his co-conspirators, William E. Dawn, 80, and Brian G. Elrod, 61, previously pleaded guilty to their roles in the scheme.

  

John (Jack) William Cranney, 76, was convicted in connection with a $6 million Ponzi scheme that defrauded 15 investors. Cranney defrauded his friends and business associates by representing that he was investing their money in a fund or retirement plan. Instead, he spent the money on personal bills and put money into his failing nutrition products distributorship.

Seth Adam Depiano, 37, was sentenced to 12 years and seven months in prison and ordered to pay more than $19.6 million in restitution following his guilty plea regarding a Ponzi scheme he ran through The Rental Group, US Funding and Home Services LLC, and Draymond Homes. Depiano had promised investors returns from the purchase and resale, or rental of real properties. He falsely represented high occupancy rates to lure in investors.

Jeffrey Lynn Gentry, 40, was sentenced to 3 years in prison in Tennessee and ordered to pay back more than $10.4 million in restitution in connection with a $43 million Ponzi scheme run through Gentry Brothers Tractor Supply that caused losses of more than $10 million. Gentry convinced investors to pull money from their retirement and savings accounts, promising them returns of 6% to 10% from investments in farming equipment that would supposedly be used to fulfill state government contracts. The scheme defrauded more than 50 people. Gentry previously pleaded guilty to the scheme.

Barry and Fern Kornfeld, and their company FEK Enterprises dba First Financial Tax Group, were the subject of an administrative complaint by Florida regulators, who accused them of selling unregistered securities to investors in the Woodbridge Group of Cos. Ponzi scheme. The Kornfelds are accused of selling at least 529 unregistered notes in 5 Woodbridge related funds for approximately $40 million. Other defendants named in the case are Andrew Grigsby Costa and Costa Financial Insurance, James Gilchrist, Albert Klager and Atlantic Insurance & Financial Services Inc., Lynette Robbins, and Knowles Systems.

Kevin Kyes, 69, was found guilty in connection with a Ponzi scheme that defrauded Japanese investors. Codefendant John Holdaway, 73, pleaded guilty last year. The investors were defrauded out of $6.8 million through a business called Money Management Strategies. Investors were told that the high-speed trading programs had historic returns of more than 100% annually.

Yasuna J. Murakami, 45, was sentenced to 6 years in prison and ordered to pay about $10.5 million in restitution in connection with a scheme he ran through MC2 Capital Management LLC and MC2 Canada Capital Management LLC. Murakami established the investment advisory firms and managed three hedge funds: the MC2 Capital Partners Fund, MC2 Capital Value Fund, and MC2 Capital Canadian Opportunities Fund. The SEC had filed charges against Murakami and his former business partner, Avi Chiat, last year and the Massachusetts Securities Division also filed civil fraud charges.

James Nickels, 67, of Wisconsin, was charged in connection with a scheme he ran through a business called “Fiscal Concierge.” The scheme brought in over $5 million from investors and caused losses of over $3 million.

Steven Pagartanis, 58, pleaded not guilty to charges that he ran a $7.5 million Ponzi scheme. The SEC, which also filed a complaint against Pagartanis, has alleged that the losses were $8 million.  Pagartanis ran the scheme through Omega Planning Associates and defrauded elderly investors. The SEC alleged that Pagartanis defrauded at least nine retail investors that were his long-standing brokerage customers.

Paul W. Smith, 63, was sentenced to 5 years in prison in Pennsylvania in connection with a $2 million Ponzi scheme. Smith had been accused criminal and by the SEC in a civil suit for running a scheme for 25 years. The scheme defrauded about 30 investors in an investment advisory scheme Smith ran through The Haverford Group.

Shawn Patrick Watkins, 48, pleaded guilty in connection with a $3.4 million real estate investment scheme. The scheme defrauded about 50 investors through real estate investment seminars conducted in California under the name The Equity Growth Group Inc. Victims were told that their money would be used to acquire or repair properties or that their money would be used as “bridge loans” to allow the company to acquire properties when money from another investor had not been received. Investors were told that there were hundreds of properties generating rental income and that the company was acquiring new properties to continue its growth. In reality, the company was not acquiring new properties and investor funds were used to pay mortgages on three homes purchased and occupied by Watkins and his family. Co-conspirator Angel Bronsgeest, 55, had earlier pleaded guilty to one count of wire fraud in connection with the scheme.

INTERNATIONAL PONZI SCHEME NEWS

Australia

Aimee Pitman, 26, and a 32-year old man were charged with running a Ponzi scheme that defrauded investors out of $800,000. The scheme persuaded investors to buy a share of an automatic teller machine, but the ATMs either didn’t exist or were owned by someone else.

Botswana

Authorities shut down foreign exchange trader Aquapanel Limited after concluding that it was running a Ponzi scheme. The company is owned by Motswana Shima Moeng Phorie, 28.

Canada

Joshua James Tenhove was charged with fraud relating to an alleged $10 million Ponzi scheme. The scheme was run through Silvertip Energy that sold or rented light towers with the same serial number to multiple investors and sold or rented units that were never manufactured.

Arnold Breitkreutz, 70, and Susan Way, 67, were charged in connection with an alleged Ponzi scheme that lured in more than $27 million from investors. The scheme was run through Base Finance and involved mortgage lending.

China

Two suspects were detained in connection with an alleged Ponzi scheme that took in over 300 million yuan (US$47 million) from over 8,000 people. The scheme was run through an investment management firm called Jielang and promised investors an 8% to 12% return on financial products. Around 80% to 90% of the victims were retirees.

Six people were arrested for allegedly defrauding 3,000 Chinese investors by selling a cryptocurrency they claim was backed by a kind of tea. They had formed a firm named PEB which issued a blockchain-powered token called Pu’er Coin. The scheme promised investors that with each token they held a portion of the Pu’er Tibetan tea supposedly owned by the firm, which was worth billions of dollars. However, there was only very limited tea in stock.

Authorities arrested four more suspects in connection with the OneCoin scheme. OneCoin, known as “Weika Coin” in China, was a billion-yuan Ponzi scheme, and 98 people have been prosecuted so far. Authorities report that $267.5 million has been recovered so far from the cryptocurrency scheme. Companies associated with OneCoin and its founder, Ruja Ignatova, are being investigated in other countries as well.

Germany

P&R Group, once one of the world’s largest container lessors, has been accused of operating a Ponzi scheme. P&R, no longer operating, sold new and used containers to investors, rented them back and offered to repurchase them after 5 years for 65% of the original value. P&R claimed it had sold around 1,600,000 containers to around 54,000 investors. The firm is now accused of selling nearly one million more shipping containers than it owned.

India

Kamal Singh and Vijay Kumar were charged in connection a scheme run through their bitcoin company, bits2btc, which allegedly defrauded over 2,500 people out of more than $14.9 million. They have ties to Amit Bhardwaj who has been charged with running a bitcoin Ponzi scheme.

Rahesh Jain and Sanchit, agents of Amit Bhardwaj, were arrested in connection with their efforts to solicit investors. They operated two Hong Kong-based companies to lure investors and promised returns of 10% each month.

Akash Goud and others were arrested in connection with a scheme that promised investors high end cars at a 30% discount. Goud used references from the few people to whom he delivered cars to lure in other customers. About 60 cars were delivered, but there were about 200 additional orders.

The properties of Oscar Group of companies were attached and bank accounts frozen in connection with an alleged Ponzi scheme run by Prabhas Chandra Rout. Rout was arrested in 2016.

Omprakash Bansantlal Goenka was arrested in connection with an alleged Ponzi scheme run through Citrus Check-Inns Ltd. and Royal Twinkle Star Club.

Sunita Samal, director of Inter Ocean Videsh Limited, was arrested on charges that he defrauded investors in various schemes.

Chhotrai Majhi, 40, was arrested on charges that he ran a Ponzi scheme through a money deposit collection company known as Shree Bhumi Construction Limited. The scheme was run under the guise of a construction company and then moved into real estate, mining and hotels. 

New Zealand

Jimmie Kevin McNicholl, 56, director of Arena Capital Limited, which traded as BlackfortFX, pleaded guilty to charges that he ran a fraudulent scheme as a foreign exchange brokerage. About 900 people invested about $8.3 million into the scheme. Lance Jack Ryan aka Lance Jared Thompson, 44, was also charged but has maintained a plea of not guilty.

Philippines

Margarita Huang aka Irma Pascual was arrested on charges that she ran a Ponzi scheme that defrauded between 29 and 46 victims. The victims were promised returns of 15% per month, but many of them received bounced checks issued by Huang and her husband, Gary Chen Huang. The Huangs claimed to be co-partners in the lending facility they supposedly operated with a large employee cooperative under Comfoods Inc.

South Africa

Derek Bredekamp, 52, has been arrested in connection with the alleged Ponzi scheme run through Platinum Forex Trading Group. It is alleged that Bredenkamp colluded with Colin Davids, the director of Platinum, to defraud investors. Approximately 2,000 investors were defrauded.

Authorities are investigating Bitcaw Trading Company aka BTC Global for alleged investment fraud. More than 28,000 investors are believed to have lost over R1-billion. Investors were promised 2% interest per day, 14% per week, and 50% per month. The founder of BTC Global, known as Steven Twain, has disappeared.

QSG Consult International is under investigation and accused of defrauding 800 people out of R380 million.

South Korea

Two South Korean individuals whose names remain anonymous were arrested for running a $30 million cryptocurrency Ponzi scheme through a company known as Upbit. The scheme brought in money from 3,787 investors who were promised a daily profit of $4,000 and were told they could double their profit if they recruited more investors. 

Turkey

Police detained 28 suspects in connection with an alleged Ponzi scheme run through Detay Maxinet, a company specializing in search engine optimization. More than $16.3 million was collected from more than 18,000 members.

April 2018 Ponzi Scheme Roundup

Posted by Kathy Bazoian Phelps

Below is a summary of the activity reported for April 2018. The reported stories reflect at least 12 new Ponzi schemes worldwide; over 1,060 years of newly imposed sentences for people involved in Ponzi schemes; and an average age of approximately 47 for the alleged Ponzi schemers. Please feel free to post comments about these or other Ponzi schemes that I may have missed. And please remember that I am just relaying what’s in the news, not writing or verifying it.

James Quinn Campbell, Jerald N. Kagarise, David Allen Bjorklund, Ronald E. Caskey, Erik K. Little and Timothy C. McGuire all agreed to cease-and-desist orders with the Colorado Division of Securities for their role in selling unregistered securities for the Woodbridge Group of Companies LLC. Laurent Carrier and his company, Carrier Financial Services, surrendered their Colorado securities licenses earlier this year.

Amrit Jaswant Singh Chahal, 30, and his company, The Kane Capital Investment Group, LLC, were charged by the CFTC in Virginia with running a commodities fraud. The alleged scheme solicited more than $1.2 million from approximately 50 investors.  The scheme promised trading profits of between 28% and 34% from the supposed trading in crude oil futures contracts. Chahal used some of the money for his personal benefit, including for a luxury car, rent, travel and dining.

David deBarardinis, 56, was indicted on new charges that he defrauded banks and investors in Louisiana out of $96 million in an alleged Ponzi scheme.  He pleaded not guilty to the charges. Investors were promised rates up to 17% with guaranteed returns and they understood that deBarardinis was a middleman in fossil fuel trades between energy companies.

Seyed Reza Ali Fazeli, 49, who has pleaded not guilty to running a sports ticket Ponzi scheme through Summit Entertainment Group, was sued by investors who alleged that the business was a Ponzi scheme. Fazeli represented that he would use the $1.3 million invested by the plaintiffs to purchase tickets to the 2017 NFL Super Bowl and resell them at a profit.

Daniel Glick, 64, was sentenced to more than 12 years in prison and ordered to pay $5.2 million in restitution in connection with a Ponzi scheme that he ran through Financial Management Strategies, Glick Accounting Services, and Glick & Associates in Chicago. The scheme involved $5.2 million taken from elderly investors.

Renwick Haddow, 49, was extradited to the U.S. after he fled to Morocco last year on charges that he was running a Ponzi scheme. Haddow, a British citizen, had relied on a fake identity using the name of Jonathan Black and a photo he stole from LinkedIn. Haddow had opened several Bar Works locations in New York and offered investors the opportunity to purchase desks at the locations for $25,000 each.

Bernard Ross Hansen, 57, and Diane Renee Erdmann, 45, were accused of running a Ponzi-like scheme that defrauded more than 3,000 investors out of $25 million. Hansen is the founder and CEO of Northwest Territorial Mint. The indictment alleges that the mint, which made coins and medallions and bought, sold and stored precious metals, lacked assets to fill customer orders. Hansen and Erdmann allegedly took $1 million of the investor funds to pay their personal expenses.

Jeffrey Mitchell Isaacs was ordered to pay $750,000 for selling New Jersey investors more than $7 million worth of unregistered securities for Woodbridge Group of Companies. Isaacs sold the unregistered securities through JB Financial Resources and JMI Associates LLC. The Woodbridge scheme defrauded 8,400 investors across the country.

Shayne Kniss, 42, was charged in Oregon for running an alleged scheme through his investment firm, Iris Capital Management Group. About 47 people invested over $4.3 million. Kniss promised investors returns of 8% to 12% returns from supposedly buying, rehabilitating and reselling houses. Instead Kniss used some money to pay back earlier investors, and about $500,000 for personal use, including investing in a retail marijuana business.

Robert Loya, 53, and Clarence Counterman, 60, had their convictions upheld by the Fifth Circuit. The two tax preparers had been convicted of running a $2.1 million Ponzi scheme. The scheme involved solicitation of investments into their solar energy related companies, including Renewable Energy Consultant Inc. (Nevada), EP Solar Technologies, Inc. (Nevada), LITTCE, Inc. (Texas) and Eco Global Corporation (Texas).

Joseph Meli, 43, and Steven Simmons, 49, were sentenced to 6½ years and 37 months, respectively, in connection with a $100 million Ponzi scheme run through Sentinel Growth Fund Management. Simmons pleaded guilty last year to charges that rose in connection with scheme that supposedly resold tickets to “Hamilton” and other shows. Meli and Simmons had assisted the hedge fund manager, Mark Varacchi, in raising money for the scheme. Varacchi pleaded guilty and has been cooperating with prosecutors.

Stephen Condon Peters, 44, saw additional assets seized in connection with alleged $15 million Ponzi scheme run through VisionQuest Wealth Management. Peters was indicted in December 2017 in connection with the scheme which promised investors returns of 8% to 9%.

Clifton E. Stanley, 66, and Michael E. Watts, 62, and their companies, The Lifepay Group LLC and SMDRE LLC, were charged by the SEC in Texas with running $2.4 million Ponzi scheme and a related $1.4 million scam involving an oil and gas company. About 30 elderly investors invested in the retirement planning and real estate investment company in which they were promised returns of up to 36% per year.

Michael Sullivan, 37, was sentenced to 160 years in prison and will serve an active prison sentence of 5 years in connection with this role a Ponzi scheme run through his company, Kenhill Financial. Sullivan was a day trader who stole about $1.4 million from 15 victims.

INTERNATIONAL PONZI SCHEME NEWS 

Canada

Wade Robert Closson, 47, who pleaded guilty to 55 counts of fraud for running a Ponzi scheme, will be sentenced. Closson ran the scheme through Optam Holdings, Inc. and Infinivest Mortgage Investment Corporation. About 71 investors lost about $5.8 million in the scheme. 

China

Officials shut down a $13 million cryptocurrency Ponzi scheme run through Da Tang Coin (DTC). About 13,000 people were defrauded on promises that members would make about 80,000 yuan ($13,000) every day.

Eight individuals were charged in connection with the Shanlin Finance Ponzi scheme. Zhou Boyun, the legal representative of Shan Lin Financial, turned himself in earlier in the month. The scheme was a peer-to-peer lending platform. Shanlin had more than 500,000 registered users and had raised 5.4 billion yuan. The company had more than 1,000 outlets across the country to sell wealth management fund products packaged with lending to infrastructure and public-private partnership projects. Users were promised annual returns ranging from 5.4% to 15%.

Dubai

Each of the two Indian men, Sydney Lemos, 37, and Ryan D’Souza, 25, who ran the Exential Group foreign exchange fraud, received 517-year prison sentences, as did Lemos’ wife, Valany Lemos. Exential offered up to 120% annual returns in connection the fraudulent investment program that defrauded 7,000 investors.

India

Amit Bhardwaj, 35, was arrested for defrauding investors in a number of cryptocurrency schemes including GainBitcoin, GBMiners, MCAP and GB21. His scam is believed to have involved over 8,000 people adding up to $300 million. Two additional arrests were made of Sahil Baghla and Nikunj Jain in connection with the scheme.

Kalakahnu Bisoi and his wife Monalisha Senapati were arrested on charges that they ran a money deposit collection Ponzi scheme.

Naresh Navale, 35, was arrested on charges that he defrauded 500 investors through his company, S M Motors. The scheme involved a car rental business in which he said he would purchase expensive cars to rent them to five-star hotels and big companies. Investors were promised Rs 20,000 per month.

Pradeep Singhal was arrested on charges that he defrauded thousands of investors in a Ponzi scheme run though a number of companies, including Astonish Digital Advertising Services. The scheme involved companies who held themselves out as facilitator for increasing views of commercial websites.

Deepak Jangra and Deepak Malhotra were arrested in connection with a $2.6 million Ponzi scheme run through Bitmineplus. Investors deposited and bought bitcoins from the company which offered returns as high as 12% plus a 5% referral fee and 10% commissions for bringing in additional investors. The website advertised: “Bitmineplus is a unique service that allows you to immediately profit from your dormant Bitcoin. It takes just seconds to transfer your Bitcoin from your wallet to your Bitmineplus saving [sic] account and you will immediately begin to receive daily interest payments.” 

Nigeria

Swiss Golden Company Limited was accused of defrauding over 7,000 Nigerians out of N3 billion. The scheme involved the buying and selling of gold bars. Maxim Lobaty, a Russian, and two Nigerians, Austin Emenike and Dickson Nonso Onuchukwu, were picked up by authorities.

Philippines

Arnel Ordino and his wife Leonady were arrested on charges that they defrauded at least 50 investors out of $17.32 million through their company, New G Bitcoin Investment Trading. The scheme promised investors a 30% return every 15 days. The couple actually had no Bitcoin dealings and made payouts to investors using money from new victims.

Russia

Authorities sought to ban Telegram, a company run by Pavel Durov who has “decided to become the new Sergey Mavroidi.” Telegram has allegedly raised about $1.8 billion in the pre-sale stage of its ICO

NEWSWORTHY LEGAL ISSUES IN PENDING PONZI SCHEME CASES

The Madoff Victim Fund made a second distribution to victims of the Bernard L. Madoff Ponzi scheme. A distribution of $504 million was made to about 21,000 victims, bringing the total distributed through the Fund to more than $1.2 billion. A total of more than $4 billion could be distributed from the Fund. In the separate SIPC proceeding, the trustee has distributed about $11 billion to the customers of Madoff’s securities firm.

Investors in the Woodbridge Group of Companies, LLC sued sales agents Lynn Merritt and Annua Group LLC seeking to recover $1.86 million in losses from the alleged Ponzi scheme run by Robert H. Shapiro. The scheme allegedly defrauded 8,400 investors out of $1.2 billion. Shapiro and his sales agents promised returns of 5% to 10% on their investments. 

CRYPTOCURRENCY NEWS

Ifan and Pincoin, which were cryptocurrency startups in Singapore and Dubai, respectively, have gone silent after reports that they were fraudulent schemes. An estimated 32,000 investors were defrauded out of an alleged $660 million in tokens. Both schemes were under the control of Vietnam-based Modern Tech. Modern Tech had been promising users in Vietnam 48% returns monthly for iFan tokens if they made an initial investment of $1,000. Users were also given 8% commissions for referring new investors.