Hamilton Ponzi-Scheme Defendant Tries to Slow Down Case

Defendant in Hamilton Ponzi Scheme Tries to Slow Court Case

Shortly after “Hamilton,” the musical about the life of Alexander Hamilton, one of America’s founding fathers, opened on Broadway it became a smash hit with ticket prices soaring. A bona fide phenomenon, fans have waited hours for lottery-based tickets or paid upwards of $2,000 to get a seat in the theater.

With tickets extremely difficult to come by, Joseph Meli and his co-conspirator Matthew Harriton saw an opportunity to make money. The two conspirators sought investments from investors with the promise that they had an agreement with the musical’s producer to purchase 35,000 tickets to be resold for a profit, with a second agreement that they had the rights to purchase 250,000 tickets to an upcoming “Harry Potter” Broadway play.

Neither Meli nor Harriton had access to such tickets, yet they still convinced 100 investors to give them nearly $97 million. Of that money, approximately $59 million was paid out in Ponzi-style payments as purported investment returns to earlier investors, while Harriton took $1.3 million in investor funds and Meli used $5 million to spend on jewelry, cars, wine, and other high-end merchandise.

Hamilton Ponzi-Scheme Defendant Tries to Slow Down Case

Meli is now in court trying to stay the case brought by the Securities & Exchange Commission (SEC), arguing that the criminal case also brought against him should proceed first so that he can preserve his right against self-incrimination.

Although the SEC has agreed to parts of Meli’s stay request, it is fighting certain aspects of it, including asking for a receiver, the issuance of third-party subpoenas, and forcing Meli to answer the SEC’s amended complaint.

Did You Invest in the Hamilton Ponzi Scheme?

If you invested with Joseph Meli or Matthew Harriton, or believe you have been the victim of another 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 Dimond Kaplan & Rothstein, P.A. , our partners here at The Fraud report, today to schedule an appointment or consultation to review your rights and options.

With offices in Los Angeles their securities lawyers have helped stockbroker fraud victims throughout Burbank, Sherman Oaks, Thousand Oaks, Calabasas and Santa Barbara, and recovered over $100 million from banks and brokerages firms for their wrongful actions.

 

Forex Ponzi Scheme Leads to Losses for Investors

SEC Sues Fugitive Over $1.7 Million Forex Ponzi Scheme

The U.S. Securities & Exchange Commission (SEC) has accused a man of defrauding investors of approximately $1.7 million in a FOREX Ponzi Scheme. Before fleeing the country, he promised investors that his computer program would generate high rates of return on foreign exchange trades. Instead of investing in the computer program as promised, his investments were used to make Ponzi-style payments and fund lavish shopping sprees.

Forex Ponzi Scheme Leads to Losses for Investors

Steve Karroum took investor money and routed it through his company, FX & Beyond Corp., to pay off earlier investors – a hallmark of a Ponzi scheme. Karroum used at least $80,000 to make personal purchases.

From 2007 to 2014, Karroum solicited nearly $4 million from investors, claiming his program could generate up to 30 percent returns for investors without risk of loss. He guaranteed profits and the return of their principal.

At some point in 2010, Karroum stopped using the money to invest in forex trading, even though he still sought funds for his program for another four years. While representing that investor money was going to his forex broker, less than half actually made it there. At least 14 investors lost a total of $1.7 million.

In order to hide his scam, Karroum provided false account statements reflecting “profits” earned from forex trading; but the purported profits were actually newer investors’ funds that were used to pay “investment returns” to earlier investors. Karroum’s wife received $335,000 from FX & Beyond’s bank account to pay off credit card bills and make mortgage payments on four condominiums.

Karroum fled to Lebanon in 2015. The SEC is seeking to enforce a subpoena against Karroum and his company, saying that he and FX held back documents that would prove the SEC’s case.

Did you unknowingly invest in the Forex Ponzi Scheme?

If you invested with Steve Karroum or FX & Beyond, you may have certain legal rights that require your immediate attention.

Call a Los Angeles Forex Attorney Today

Contact an experienced Los Angeles forex attorney today for a consultation to discuss your rights and options.

Global Information Network Ponzi Scheme case settles.

Global Information Network Ponzi Scheme Crashes

“Success Fraud” Pyramid Scheme Raises $4.7M

A Texas man agreed to settle charges with the U.S. Securities & Exchange Commission (SEC) after he was accused of raising more than $4.7 million by targeting fellow members of a pyramid scheme “success club.”

According to the SEC, Darrell Hardaway and his company, Hardaway Net-Works Inc. (HNW) raised money from investors by claiming that his company was “growing robustly” and would soon file for an IPO.

In the Global Information Network Ponzi Scheme, Hardaway targeted fellow members of the Global Information Network, a “success club” claiming to help its members achieve business success.

Global Information Network Ponzi Scheme

The Federal Trade Commission (FTC) has labeled the organization a pyramid, or Ponzi scheme, whereby new investor money was used to pay “investment returns” to earlier investors. Hardaway was a high-ranking member of the Global Information Network, whose founder was ordered to pay a $37.6 million contempt judgment to the FTC in 2010 for making misleading statements in infomercials and was also found guilty of criminal contempt for misrepresenting the content of a book he once wrote.

Global Information Network Members Invest in Ponzi Scheme

Investors fell for Hardaway’s promises of massive returns and a forthcoming IPO, which never materialized.

Hardaway began raising funds through a private offering of HNW shares in 2010, telling investors that the money would provide internet and technology support to Houston- area hotels and expected to generate a $2.3 million return in the first year. The company generated no income in 2010 and only $2,250 in 2011, against $1.4 million in expenses. Hardaway represented that the company was poised to expand its customer base to 300 hotels, while only having two clients and no concrete plans to expand operations.

Instead of focusing on the business, Hardaway zeroed in on the prospect of an IPO to convince would-be shareholders that their profits would be significant. HNW did not come close to having the funds to go public, and only earned approximately $25,000 from 2010 to 2016 while incurring nearly $5 million in expenses. Among other things, Hardaway used the money for travel, private investment, and personal items.

Involved in the Global Information Network Ponzi Scheme?

If you invested with Darrell Hardaway or Hardaway Net- Works Inc., or invested in a similar scam, you may have certain legal rights that require your immediate attention.

Call a Los Angeles Securities Fraud Attorney Today

Contact an experienced Los Angeles securities fraud attorney today for a consultation to discuss your rights and options.

ZeekRewards CEO ran multi-million dollar ponzi scheme.

ZeekRewards CEO Sentenced to 15 Years for Ponzi Scheme

A federal judge in North Carolina just sentenced the former ZeekRewards CEO to 15 years in prison and ordered to pay $244 million in restitution for his role in operating a $900 million Internet Ponzi scheme.

Paul Burks, the CEO of penny auction company Zeekler and ZeekRewards, was sentenced on charges of wire and mail fraud conspiracy, wire and mail fraud, and tax fraud conspiracy after a trial showed his scam victimized more than 900,000 people.

Burks owned Zeekler and ZeekRewards through his investment company, Rex Venture Group LLC. He convinced investors that his “retail profit pool” allegedly allowed them to share 50 percent of Zeekler’s daily net profits, according to DOJ prosecutors. In reality, the available funds were redistributed in “Ponzi-style payments” based on completely bogus profits intended to give investors the impression the fund was doing extremely well. Burks was charged with making up the profit numbers.

Contrary to the claims made by the ZeekRewards CEO, nearly 98 percent of all incoming funds came from investors, whose money was used to pay earlier investors – a hallmark of any Ponzi scheme.

Prosecutors said the ZeekRewards CEO took in more than $800 million from victims in VIP bid purchases and another $97 million from subscription fees. At one point in 2012, victims were told that their investments had ballooned to $3 billion, compared with only $340 million in cash available to make good on the bogus profit report.

The ZeekRewards CEO personally profited $10 million for his part in running the scam.

Did You Invest with ZeekRewards CEO Paul Burks?

If you invested with Zeekler or ZeekRewards CEO Paul Burks, or invested in a similar scam, you may have certain legal rights that require your immediate attention.

Call a Los Angeles Securities Fraud Attorney Today

Contact an experienced Los Angeles securities attorney today for a consultation to discuss your rights and options.

Assurance Capital Management Investment Scam

Assurance Capital Management Investment Scam

Federal prosecutors indicted a Tampa-area executive of Assurance Capital Management on fraud charges for allegedly running an $18 million investment scam while he already was on probation from previous offenses related to money laundering and fraud in Alabama.

Anthony Klatch is facing one count of wire fraud for running a scheme through his company, Assurance Capital Management LLC (ACM), which he purportedly told investors was a profitable online stock trading company with more than $18 million in client funds under management.

According to prosecutors, Klatch used Assurance Capital Management as a shell company to defraud his unsuspecting investors between June and September 2015. Instead of identifying himself, Klatch allegedly pretended to be a fund manager for ACM named Larry Heim. He also is accused of falsifying financial statements and other investment material to show that the company was profitable – and that it had more than $18 million in client accounts. Assurance Capital Management held little, if any, funds itself.

Instead, Klatch either lost client money via bad trades or used it for personal expenses. Klatch told investors to wire the money directly to ACM’s account at Chase Bank to be traded. He also asked for access to clients’ accounts so he could make trades on their behalf.

In addition to Klatch’s alleged fraud, he also did not disclose to his investors that he had previously pled guilty to securities fraud, wire fraud, conspiracy, and money laundering in 2011 – charges for which he spent three years in an Alabama prison.

Because of his prior conviction, Klatch was banned by the Commodities Futures Trading Commission and the SEC from trading in stock markets.

Call a Los Angeles Securities Fraud Attorney Today

As a general reminder, you should always check your broker’s credentials through an independent source. As with the case above, people willing to commit fraud will go to great lengths, including creating falsified financial statements, to take your money.

If you invested with Anthony Klatch, Larry Heim, or Assurance Capital Management, contact a qualified attorney to discuss your options. If you suffered a loss at the hands of a financial advisor, you may have certain legal rights that require your immediate attention.

Contact an experienced Los Angeles securities fraud attorney today for a consultation to discuss your rights and options.

Bank building of California Judge Upholds Ponzi Mastermind William Wise

Sentence Upheld Against Ponzi Mastermind William Wise

A California federal judge upheld the 21-year prison sentence for the Ponzi mastermind William Wise of a $130 million Ponzi scheme, involving fraudulent certificates of deposit from Millennium Bank, rejecting his argument that an attorney took on the case in order to “curry favor” from a now-appointed state judge.

William Wise was convicted last year of orchestrating a scheme that defrauded more than 1,200 investors through the offering of fraudulent certificates of deposit (CDs). Wise, who once operated Millennium Bank, scammed investors by offering products that would offer rates of return 321% higher than other banks’ CDs. As a result of his scheme, he personally profited more than $50 million.

Wise argued that his former attorney had several conflicts of interest and that his sentence should be tossed. Wise also argued that his trial attorney failed to adequately research his case, tantamount to deficient representation. While the judge said failing to prepare could lead to ineffectiveness of counsel, in this case it would not have changed the outcome of the case for several reasons.

For starters, Wise failed to point out anything that would’ve strengthened his case during plea bargaining. Further, he had an incentive to plead guilty to save a deal to allow him to return home to Canada, and finally, because the court would have been unlikely to agree to a lower sentence, since the agreement called for the lowest sentence stipulated by sentencing guidelines.

Call a Los Angeles Securities Fraud Attorney Today

If you invested with Ponzi mastermind William Wise or Millennium Bank, you may have certain legal rights that require your immediate attention.

Contact an experienced Los Angeles securities fraud attorney today for a consultation to discuss your rights and options.