Ponzi Suspect Mark Feathers to Change Plea After Threat

Ponzi Suspect Mark Feathers to Change Plea After Threat

The federal government has told a California federal judge that it reached an initial plea deal with investment manager Mark Feathers, who is charged with securities fraud for running a $42 million Ponzi scheme. The plea deal comes eight months after Feathers threatened those involved with the case and saw his bail revoked.

According to a federal grand jury indictment, Mark Feathers, the founder and CEO of Small Business Capital Corp. (“SBCC”), raised more than $50 million from more than 250 investors by promising profits from membership interests in mortgage loan investment funds. Feathers paid some returns to investors by using money that came from new investors—the hallmark of a Ponzi scheme.

Mark Feathers Faces Multiple Counts of Securities Fraud

Feathers faces 17 counts of securities fraud and 12 counts of mail fraud for the investment scheme. After his arrest, he pled not guilty in November 2014 and was released on $250,000 bond. The bond was revoked in March after Feathers sent an email to eight people involved with the case—including U.S. Securities and Exchange Commission attorneys, a court-appointed receiver and his former counsel—threatening violence to anyone who uses words at trial that suggest he was a thief. This past summer he unsuccessfully bid to be released from custody.

The indictment alleges that from 2009 to 2012, Feathers improperly transferred more than $6 million of investment funds to SBCC to pay its operating expenses. Additionally, he allegedly transferred eight mortgage loans from one fund to another, sold at an inflated price, and then took some of that money to pay approximately $570,000 in management fees to SBCC. Feathers used about $2 million dollars of investors’ money for his personal benefit.

Did You Lose Money Investing with Mark Feathers?

If you believe you have lost money investing with Mark Feathers or in any investment scheme, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

 

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RBC Unit Aided $45M ATM Ponzi Scheme

RBC Unit Aided $45M ATM Ponzi Scheme

Investors Claim Scheme Lasted 15 Years

A putative class action was filed in New York Federal court recently against a Royal Bank of Canada subsidiary and a senior executive, accusing them of aiding a 15-year ATM Ponzi scheme. The scheme allegedly defrauded investors out of $45 million.

The suit alleges that Patrick Brian Fitzwilliam, Senior Vice President of City National Bank NA,  who managed the bank’s Woodland Hills, California, branch, aided now-imprisoned fraudsters Joel Gillis, 77, and Edward Wishner, 78 by moving stolen investor funds to and from fraudulent accounts held with the bank under the name Nationwide Automatic Systems Inc. (NASI).

The suit says that Fitzwilliam personally oversaw the NASI account and that CNB’s involvement in and knowledge of the Ponzi scheme occurred through Fitzwilliam’s servicing of the account. Fitzwilliam and the bank allegedly vouched for the integrity of the ATM Ponzi scheme to investors, who in turn funneled millions into the company, and helped Gillis and Wishner cover negative bank balances.

NASI Operates Ponzi Scheme through ATMs

According to the suit, Gillis and Wishner told investors they would receive 50 cents per transaction on the ATMs, yielding a guaranteed 20 percent annual return. The ATMs were purchased by investors at the cost of either $12,000 or $19,800 per machine and payments per transaction, were made with money taken in from newer investors.

For eight years, from 2006 through 2014, approximately $400 million dollars of investors’ money flowed into and out of NASI’s accounts at the bank, generating substantial service fees and profits for City National Bank.

Fitzwilliam and Wife Were Complicit in NASI Ponzi Scheme

During that time, the suit claims that activity from NASI’s accounts generated substantial compensation for Fitzwilliam. Though he knew that the company had legitimate ATM transaction revenue from only 250 real ATMs and not the thousands of ATMs that the fraudsters touted to investors, he allegedly sent potential investors promotional letters, actively misrepresenting the status of the investment scheme.

In 2006, Fitzwilliam and his wife, Betty Saleh Fitzwilliam, invested thousands of dollars into NASI, but cashed out most of their investment when they saw the scheme was on the verge of collapse. The couple took more than $250,000 in ill-gotten gains plus another $60,000 from NASI less than a month before the bank terminated the company as a client in 2014. Betty Fitzwilliam is not named as a defendant in the suit.

SEC Takes Action Against NASI in 2014

The U.S. Securities and Exchange Commission sued NASI in 2014 and placed it in receivership. Shortly after, Wishner and Gillis pled guilty to conspiracy, mail fraud, and wire fraud charges for running the scheme, resulting in 9 and 10-year federal prison sentences, respectively.

At the same time, the receiver sued Fitzwilliam, his wife, and the bank in June 2016, asserting similar claims of enabling the 15-year Ponzi scheme.

Since the SEC suit against NASI in 2014, two putative class actions have been filed against the bank and Fitzwilliam in California state court. In September 2016, a group of approximately 40 individual California-based investors also sued the bank and Fitzwilliam over their losses. Three of the four suits filed – the individual investors’ suit, one of the two putative class actions and the receiver’s action – are currently pending in California state courts.

The other putative class action was tossed by a state judge under the anti-SLAPP statute. The plaintiffs in that action have since appealed the judge’s ruling.

Plaintiffs Seek to Certify Class

The plaintiffs seek to certify a class of approximately 500-600 investors from 36 states outside of California who invested in the company between 2009 and 2014. Those investors do not believe the pending California class actions adequately protect out-of-state victims.

Did You Lose Money to a Ponzi Scheme?

If you believe you have been the victim of a Ponzi scheme or other investment scheme, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions, including financial institutions that assisted Ponzi schemers.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

 

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CFTC Accuses Profit Management of $1.2M Ponzi Scheme

CFTC Accuses Profit Management of $1.2M Ponzi Scheme

The U.S. Commodity Futures Trading Commission (CFTC) recently filed suit in New York federal court accusing a California husband and wife of running a Ponzi scheme. The couple’s company, Profit Management, received nearly $1.2 million from investors with the understanding that their money would be used to trade in futures through a commodities pool. The pool never made such trades.

The couple, Hasan Sarwar and Rachida Elfrimi of Rancho Cucamonga, allegedly defrauded more than 40 investors by falsely claiming that Profit Management’s commodities pool made a daily return of 5 to 7 percent. But the pool did not conduct any futures trades and earned no profits.

According to the CFTC’s allegations, investors’ money was placed in bank accounts belonging to Sarwar and Elfrimi. Sarwar used a little less than half of investors’ funds for trading in his own personal account — where all but about $5,800 was eaten up by bad trades and account fees — and for paying the couple’s business and personal expenses.

The rest went to Ponzi-style payments to early investors. To keep the scheme going, investors were sent false account statements showing how much money was being held in their names.

CTFC Seeks Permanent Injunction

The CFTC alleges that Profit Management and Sarwar and Elfrimi’s conduct violated the Commodity Exchange Act and other CFTC regulations. The agency seeks restitution, disgorgement, and civil monetary penalties, in addition to trading and registration bans and a permanent injunction against future violations.

Did You Loose Money to Profit Management? 

If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.

Call an Investment Fraud Attorney Today

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

 

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Gold and Diamond Investment Fraud Scheme Leads to Prison

Gold and Diamond Investment Fraud Scheme Leads to Prison

The originator of a gold and diamond investment fraud scheme has been sentenced in a North Carolina federal court to more than seven years in prison. The scheme, orchestrated by Cassell Anthony Kuoh, bilked victims out of more than $9.5 million.

Kuoh is a Liberian national who lived in Liberia and owned Phoenix Mining and Investment Group (Phoenix Mining), which claimed to be in the precious metal and gemstone business.

From 2012 to 2016 Kuoh devised and operated a scheme involving the purchase, shipment, and export of unrefined gold and rough diamonds from Liberia.

He told investors their money would be used to move the gold and diamonds into the United States, which then would be refined or cut and sold for a profit. As part of the scheme, he even invited investors to Africa to visit the mining operations and inspect the gold and diamonds.

For investors who made the journey, operations were set up by Kuoh to look legitimate and profitable, when in fact Kuoh borrowed gold and diamonds from others. Once Kuoh received the funds from investors he used stall tactics and lies to cover up the scheme, including falsifying documents and creating fake companies.

According to prosecutors, Kuoh used investors’ money to fund his personal lifestyle, including the purchase of a house in Harrisburg, North Carolina.

Kuoh Pleads Guilty Prior to Sentencing

In addition to seven years in prison, Kuoh was ordered to pay $16.2 million in restitution. As a Liberian national, he also will be subject to deportation proceedings upon the completion of his federal sentence.

In March 2017, he pleaded guilty to conspiracy to commit wire fraud. Kuoh’s co-defendant, Emmanuel Tarr, 30, of Liberia, is awaiting sentencing after pleading guilty to wire fraud conspiracy.

Do You Lose Money in an Investment Fraud Scheme?

If you have been a victim of an investment fraud scheme or are suspicious that your broker is not acting in your best interest, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an investment fraud attorney to review your rights and options, the securities fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from brokers and brokerage firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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Chicago Madoff Scammer Sentenced to Prison

Chicago Madoff Scammer Sentenced to Prison

An Illinois federal court has sentenced a Chicago man accused of running a Madoff-type scheme to nearly six years behind bars. After the fraudster conned investors of more than $1.7 million, prosecutors have called him the “Chicago Madoff” scammer.

Chicago Madoff Scammer Promised Returns

The Madoff scammer in question is 26-year-old Randall Rye who founded Chicago trading firm “Faster than Light Trading LLC.” Rye claimed that he had developed a trading algorithm guaranteed to produce high returns, but it was a scam. Prosecutors alleged that not only was there no algorithm, Rye also did not invest investor’s money. Instead, he spent investors’ money on expensive tickets to sporting events, trips to foreign locations, and lavish personal expenses.

In April 2017, Rye pled guilty, admitting that he defrauded about 20 investors between September 2015 and February 2017 – including his then-girlfriend’s father and other relatives. Rye was also ordered to pay back $1.7 million to his investors.

Do You Lose Money with Randall Rye?

If you have been a victim of a Ponzi scheme or are suspicious that your broker is not acting in your best interest, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an attorney to review your rights and options, investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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Man Sentenced for Ponzi Scheme Assistance

Man Sentenced for Ponzi Scheme Assistance

Ponzi Scheme Assistance Leads to Prison

A Pennsylvania man has been sentenced in Texas to time in prison for assisting a Mexican businessman in the operations of a $14 million dollar Ponzi scheme.
A federal judge has sentenced 61-year-old David Brian Binder of Pittsburg, PA, to 30 months in federal prison followed by three years of supervised release. In addition, a United States District judge has ordered Binder to pay a $5,000 fine and $503,027.90 restitution.

The Mexican businessman in the case is Roberto Trinidad Del Carpio Frescas, who presented himself to investors as a licensed investment broker and expert in stocks, bonds, futures in oil, gas, precious metals and currency.

Though he was not licensed in the state of Texas as a dealer, Del Carpio collected money from over 100 known investors in Mexico and the United States. From August 2010 to January 2012, Del Carpio pocketed most all of the funds he collected. He paid only minimal amounts of money to “early” investors as a return on their investment and to encourage his victims to invest more of their money with him – a hallmark of a Ponzi scheme.

After an investigation and trial, on Binder pleaded guilty to one count of wire fraud on March 3, 2017. He also admitted that he assisted Del Carpio in keeping proceeds from the scheme out of the hands of potential creditors as well as lying to them about protecting their investments.

Have You Been a Victim of a Ponzi Scheme?

If you are the victim of a Ponzi scheme or have lost money in an investment scheme, you may have certain legal rights that require your immediate attention.

Call An Investment Attorney Today

If you are looking for an investment fraud attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

With offices in Los AngelesNew YorkWest Palm Beach and Miami, our investment fraud attorneys represent clients nationwide and may be able to help you recover your investment losses.

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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Australian Investment Fraud Syndicate

$30M Australian Investment Fraud Syndicate Busted

Australian Investment Fraud Syndicate Discovered

An alleged $30 million Australian investment fraud syndicate was uncovered and shut down. After a two-year investigation, Australian police have shut down the Australian investment fraud syndicate that allegedly preyed on over 2,000 victims across Australia.

The three-year scam involved cold calling people with high-pressure sales tactics and offering them large returns on market investments. It was supported by websites containing fake information about the products and companies being sold.

Once victim’s money was obtained, the scammers laundered it through other victims, earmarking the money as the ‘returns’ on market investments, only to be reinvested in the scam.

The investigation was completed by the State Crime Command and culminated in raids on homes and businesses on the Gold Coast, in addition to one residence and business in Brisbane. Four men and one woman have been charged.

Have You Been a Victim of Investment Fraud?

If you are the victim of investment fraud or believe you have been scammed, you may have certain legal rights that require your immediate attention.

Call an Investment Fraud Attorney Today

If you are looking for an attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerages firms for their wrongful actions.

Contact an attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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Athlete Ponzi Scheme

Athlete Ponzi Scheme Perpetrators Convicted

Ponzi Scheme Preyed on Athletes

A former Miami Dolphins player and a bank executive have been convicted in a Ponzi scheme involving other athletes. Former Miami Dolphins player Will Allen and Susan Daub pleaded guilty to two counts of wire fraud, one count of conspiracy, and one count of money laundering in a Massachusetts federal court.

They were first arrested on criminal charges in June 2015 after being sued by the Securities and Exchange Commission earlier that year.

The pair were charged with operating a $32 million dollar Athlete Ponzi Scheme Boston-based Capital Financial Partners LLC. The firm would advertise private lending and short-term loans to athletes short on cash. Average loan amounts were about $600,000 on a 12-month term at favorable rates.

To pay out the loans the duo would solicit money from investors, telling them that they would profit from interest payments, which were as high as 18 percent. The duo often collected more money than was being loaned and regularly oversubscribed investments. The money was collected between June 2012 and March 2015.

While the duo did make some loans to athletes, the bulk of the money was diverted to personal accounts and other businesses. Some of the money also was used to pay off earlier investors, typical of a Ponzi scheme. According to the U.S. Attorney’s office, Allen and Daub took in more than $35 million in investments, repaying less than $22 million.

About Athlete Ponzi Scheme Perpetrators Allen and Daub

Former football player Will Allen played for the Miami Dolphins and New York Giants between 2001 and 2012. In 2012, he signed a one-year contract with the New England Patriots. Susan Daub is a 55-year-old former bank executive. It is not reported how the two met and decided to start their scheme.

Call a Securities Fraud Attorney Today

If you are looking for a securities fraud attorney to review your rights and options, the lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more $100 million from banks and brokerages firms for their wrongful actions.

Contact a securities fraud attorney at Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

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Miami Man Gets 15 Years in Essex Holdings Ponzi Scheme

Miami Man Gets 15 Years in Essex Holdings Ponzi Scheme

Federal Judge Orders Prison Time

In the latest news regarding the Essex Holding Ponzi Scheme, a Miami federal judge has sentenced a man to 15 years in prison and ordered him to forfeit more than $30 million in property and money. The money and property were obtained through his sugar shipping and mining Ponzi scheme and another scam he perpetrated.

Navin Shankar Subramaniam Xavier ran both of his schemes through his Miami Gardens-based company Essex Holdings Inc. Xavier pled guilty in January to two counts of wire fraud, during which he faced up to 20 years in jail for each charge.

According to prosecutors, most of the money Xavier obtained in the Essex Holding Ponzi Scheme was used to purchase lavish personal goods, including luxury vehicles, and watches, and diamonds. He transferred more than $13 million to accounts in Chile, Malaysia, and Singapore.

The FBI stopped Xavier after learning he made travel plans to Haiti the same day he was due to appear in court. He was considered a flight risk.

The Workings of the Essex Holdings Ponzi Scheme

To lure investors to his scheme, Xavier issued false financial statements through Essex Holdings and offering rates of return between 8-25% within nine months. He used new investor money to pay off earlier investors, a Ponzi-scheme hallmark.

He also secured payments and property from South Carolina by presenting phony financials to the South Carolina Coordinating Council for Economic Development. Essex was supposed to invest more than $54 million of its money into a project over a five-year period – it does not appear that any money was ever invested in the project.

Eventually, Xavier’s Ponzi scheme unraveled when he failed to have sufficient funds to pay off earlier investors.

Did You Invest with Essex Holdings?

Even savvy investors can be defrauded by a Ponzi scheme. If it sounds too good to be true, it probably is. If you believe you have been the victim of a similar kind of scam to the one perpetrated by Xavier and his company, contact an experienced Ponzi-scheme attorney today.

Call a Ponzi Scheme Attorney Today

If you are looking for an attorney to review your rights and options, the attorneys at Dimond Kaplan & Rothstein, P.A. have helped Ponzi-scheme victims throughout the United States and recovered millions for those victims.

With offices in Los Angeles, they have helped stockbroker fraud victims throughout Brentwood, Santa Monica, Hollywood, and West Hollywood.

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Former Philly Stockbroker Sentenced for Securities Fraud

Former Philly Stockbroker Sentenced for Securities Fraud

Stockbroker Sentenced to Prison for Ponzi Scheme

A former Philadelphia-based stockbroker was sentenced to 6 ½ years in prison after defrauding investors of more than $3.2 million, according to a recent statement from the U.S. Attorney’s Office.

William Bucci pled guilty to securities fraud and other related charges. Among his victims were a Catholic priest and retired firefighter, whom he told that he was starting a business to import high-end olive oil and wine from Italy. In fact, Bucci never set up any business of the sort.

Stockbroker Scammed Friends and Classmates

In addition to his prison sentence, Bucci also was ordered to pay more than $3 million to his victims and the IRS. Bucci served as the president of the Order Sons of Italy from 2003 to 2007, the oldest and largest Italian-American fraternal organization in the U.S., through which he met several of his victims. In addition to those he met through the Order, he solicited old classmates and friends, promising to give them as much as 10 percent interest annually with a return the principal within a few years.

Instead of paying back friends and family, Bucci used investors’ money to support his lifestyle and pay off earlier victims, in Ponzi-scheme fashion. According to FINRA, Bucci was licensed at various brokerage firms between 2002 and 2012. His stockbroker’s license has since been revoked.

Call a Ponzi Scheme Attorney Today

If you invested with William Bucci or believe you have been the victim of a similar Ponzi scheme, you may have legal rights that require your attention and you should contact a qualified investment fraud attorney immediately.

Call a Ponzi Scheme Attorney Today

Contact an attorney at The Fraud Report’s partner law firm, Dimond Kaplan & Rothstein, P.A. today to schedule an appointment or consultation to review your rights and options.

With offices in Los Angeles, our securities lawyers throughout Santa Monica, Beverly Hills, and Hollywood they assist you with any securities issues that you may be facing.

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