Tag: Ponzi Scheme

Ponzi Suspect Mark Feathers to Change Plea After Threat

Ponzi Suspect Mark Feathers to Change Plea After Threat

dkradmin

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 The bond was revoked in March after Feathers sent an email to eight people involved with the case—including U.S. Securities and Exchange Commission attorneys, a court-appointed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 Angeles, New York, West 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.

 

Chicago Adviser Daniel Glick Defrauded Clients Out of $5M

Chicago Adviser Daniel Glick Defrauded Clients Out of $5M

dkradmin

The U.S. Department of Justice has charged a Chicago investment adviser with stealing more than $5 million from clients and family members in a Ponzi-style scheme. The adviser, Daniel Glick, used the money to purchase a luxury car, repay business loans, and pay his mortgage.

According to U.S. Attorney Joel Levin, 64-year-old Glick allegedly stole $5.2 million from clients of his three accounting and financial services firms in Orland Park, a suburb of Chicago. Glick was charged with one count of wire fraud and could face up to 20 years in prison if convicted.

Glick Operated Ponzi-like Scheme

Glick is alleged to have stolen the money through his three businesses and spent it on himself and business associates. To cover up the fraud, he used a Ponzi-like scheme, comingling funds and routinely paying clients with other clients’ money.

The indictment stated that in order to conceal the scheme, Glick continued to pay bills and expenses for certain clients, even though their funds were depleted or in some cases gone. In one instance, Glick used another client’s funds to pay nursing home expenses for an elderly client, whose funds Glick already had used up.

Glick also fraudulently obtained hundreds of thousands of dollars from his elderly in-laws by using fake signatures to fool Citizens Banks and U.S. Bank into transferring their money to his accounts.

In addition to outright stealing, Glick’s businesses—Financial Management Strategies Inc., Glick Accounting Services Inc., and Glick & Associates Ltd.—also received large benefit fees. According to the indictment, Glick convinced one family to pay him $700,000 in fees, even though he had already misappropriated hundreds of thousands of dollars of their money.

SEC Files Civil Suit Against Daniel Glick

In March the U.S. Securities and Exchange Commission (SEC) sued Glick and two of his business associates for similar actions. The SEC also claims that two of Glick’s business associates, Edward Forte and David Slagter, received close to $1 million from Glick’s scheme.

Have You Lost Money with Daniel Glick?

If you believe you have been the victim of an investment scheme or have lost money investing with Daniel Glick, 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 over $100 million from banks and brokerage firms for their wrongful actions.

With offices in Los Angeles, New York, West 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 option

Chicago Madoff Scammer Sentenced to Prison

Chicago Madoff Scammer Sentenced to Prison

dkradmin

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 Angeles, New York, West 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.

EB-5 Investors File Suit Against California Attorney

EB-5 Investor Lawsuit Filed Against California Attorney

dkradmin

A group of Chinese nationals have filed an EB-5 investor lawsuit in a California state court against a California attorney and her father. The claim states that the Chinese nationals were “victims of a fraudulent scheme” that promised them visas in exchange for investments in the EB-5 program.

The claim, filed by Yeqing Xia, Rui Zhang, Song Yao Li and Ting Li, alleges that the plaintiffs were solicited in 2011 to apply to the EB-5 visa program by attorney Victoria Chan and her father. To qualify, they each handed over more than $500,000, not including attorneys’ fees.

The four plaintiffs are among more than 100 Chinese nationals allegedly solicited in the EB-5 investor scheme.

EB-5 Investors Caught in $50M Scam

The attorney, Victoria Chan, and her father, Tat Chan, have been accused by the FBI of exploiting the EB-5 immigrant investor program. Federal authorities allege that the Chans stole millions of dollars from investors, spending the money on personal property purchases and expenses. The allegations suggest that the Chans defrauded EB-5 investors of $50 million over the course of nearly a decade.

Government prosecutors have filed nine property forfeiture actions against the Chans. According to Law360, the nine properties involved in the forfeiture actions total more than $30 million. One of them is a commercial property in the City of Industry worth more than $3 million and a $707 million parcel of land in Rancho Cucamonga.

The government also accuses the Chans of redirecting business funds for personal gain. Their business was registered as the California Investment Immigration Fund LLC (CIIF).

Fraudulent CIIF Scheme

According to documents filed, the Chans launched their EB-5 scheme nine years ago. Victoria Chan submitted a request to designate her organization, the California Immigration Investment Fund (CIIF), as a regional center to the United States Citizenship and Immigration Services office. The request was approved.

U.S. operations for the company were run by Victoria Chan out of the San Gabriel Hilton Hotel while her father Tat led the Chinese side in Guangzhou, a city in southern China.

According to the FBI affidavit, the CIIF had at least 14 affiliating companies and service providers. In reality, the CIIF regional center was staffed with high schoolers who were paid to pose as full-time employees.

In addition, FBI agents found that supposed developments were not actually in progress, and to date, nothing had been built. Despite this, some of the CIIF investors seemingly obtained visas and green cards. The investigation is ongoing.

The EB-5 Program

The EB-5 visa program offers green cards to foreign citizens who invest in American businesses. The program centers around a “regional center,” which acts as an intermediary between the developers and investors. In exchange for investments, EB-5 investors are promised U.S. visas and green cards.

Typically, regional centers charge developers between 5 and 8 percent of the total capital raised, charging each investor an administrative fee of $25,000 to $60,000 on top of the $500,000 minimum commitment they are making to the project.

Are You Caught in an EB-5 Investor Scam?  

If you invested with the Chans or think you may be involved in an EB-5 investor scam, 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 for clients for wrongful actions.

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

Assurance Capital Management Investment Scam

Assurance Capital Management Investment Scam

dkradmin

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.

Pillars of law at a federal court house.

Investment Manager Guilty in Commodities Fraud Case

dkradmin

New York Investment manager Haena Park pled guilty in New York federal court to one count of commodities fraud after losing nearly $20 million. A large portion of the money in the commodities fraud case came from friends, family, and fellow Harvard alumni.

Between 2010 and 2016, Haena Park convinced investors, including her parents and other close family members, to invest in funds and investment pools she managed under one of her two firms, Phaetra and Argenta. According to prosecutors, her trading was “consistently unsuccessful,” so she generated phony account statements to cover up her mistakes. As is typical in Ponzi schemes, Park also tried to hide her losses by using new investor money to pay earlier investors.

When her initial strategy failed, Park claimed she made highly leveraged trades with the hope of making the money back; however, she ended up digging the hole even deeper.

Now, Haena Park faces up to 10 years in prison. In exchange for a plea agreement, the government has dropped a wire fraud charge that could have added another 10 years to her sentence. The plea agreement recuses Park from arguing for a sentence below the guideline range of 108-120 months.

Additionally, Park also has agreed to forfeit $23.19 million, which includes trading losses and another $3 million used to pay off investors to keep her scam afloat.

In addition to being the subject of the commodities fraud case, Park is also the subject of civil actions by the SEC and Commodity Futures Trading Commission, which is seeking to ban her from trading. Those cases were stayed, pending the resolution of her criminal case.

Contact a Commodities Fraud Attorney Today

If you suspect your broker or brokerage firm of malfeasance of any kind, you may have certain legal rights that require your immediate attention.

Contact a Los Angeles commodities fraud attorney today to schedule an appointment or consultation.

Bank paper listing wire transfers.

South Florida Essex Holdings Exec Admits Fraud

dkradmin

A South Florida executive of Essex Holdings Inc. pled guilty in federal court to two counts of wire fraud in connection with a $29 million Ponzi scheme and another scam intended to illegally obtain economic development funds from South Carolina.

Navin Shankar Subramaniam Xavier, from Miramar, will be facing up to 20 years in prison and faces a $250,000 fine for each count when sentenced. Prosecutors agreed to drop an additional 13 counts of wire fraud against Xavier as part of his plea deal.

Xavier ran his schemes through Essex Holdings Inc. in Miami Gardens. His company purported to place investor funds in sugar shipping and iron ore mining in Chile. Xavier allegedly promised rates of return ranging from 8 to nearly 25 percent in the first nine months to convince nearly 100 investors to entrust him with nearly $29 million.

Instead, most of the money taken in the scam was spent on personal items, including a luxury SUV, several watches, diamonds, and even property in South Carolina. Later investors’ money was used to pay returns to earlier investors – a classic signature of a Ponzi scheme.

Xavier also received payments and property from the South Carolina Coordinating Council for Economic Development by providing falsified financial documents for Essex Holdings, claiming millions in assets that did not exist. The money and property were supposed to go toward revitalizing an industrial property into a diaper plant and rice packaging center. The revitalization did not happen.

Call a Securities Fraud Attorney Today

If you invested with Navin Xavier, Essex Holdings Inc., or believe you have been the victim of a similar Ponzi scheme, you may have certain legal rights that require your immediate attention.

The attorneys at Dimond Kaplan & Rothstein, P.A. have recovered over $100 million from banks and brokerage firms for their wrongful actions. Contact us to schedule a consultation today.

Wine bottles on the shelf at Premier Cru

Premier Cru Owner John Fox Sentenced in Ponzi Scheme

dkradmin

A California federal judge sentenced the owner of a bankrupt wine store to 6 ½ years in prison for operating a Ponzi-like scheme in which he pretended to sell wine in advance of its arrival from Europe. The owner was keeping the money instead.

The owner of the store, John Fox, pled guilty to allegations that he sold wine through his company, Premier Cru, but failed to purchase the wine and instead spent the money on cars, golf club memberships, and more.

Between 2010 and 2015, Premier Cru owner John Fox sold or attempted to sell nearly $20 million in wine that he never actually purchased before adding the items to his inventory. Fox would often falsify purchase orders, then use those orders to sell to customers, promising that they would receive their wine between 6 months and 2 years from the purchase date.

Premier Cru owner John Fox was accused of embezzling directly from his business by charging the company’s accounts to pay for personal expenses and making transfers to other personal accounts, sometimes using fake names to do so.

When Premier Cru owner John Fox did contract to buy European wine, he promised to pay suppliers within 30 days but admitted it was a lie, since he spent money from new customers on himself and to pay previous customers for wine that never got delivered.

Premier Cru owner John Fox filed for Chapter 7 bankruptcy protection in January. At the time of the filing, customers had paid about $45 million for wine that hadn’t been delivered.

Call a Los Angeles Ponzi Scheme Attorney Today

If you are a victim of Premier Cru owner John Fox or have lost money through a similar Ponzi Scheme, contact an experienced Los Angeles securities attorney today for a consultation to discuss your rights and options.

Rolled up dollar bill in a cage meant to conceptualize enticing money in illegal situations.

California Pair Tied to $900M Ponzi Scheme Sent to Prison

dkradmin

A stepmother and stepson who helped run a penny auction company tied to a massive $900 million Ponzi scheme were sentenced to a combined nine years in prison for their roles in the scheme.

Dawn Olivares, once the COO of ZeekRewards, was sentenced to 7.5 years in prison for her role in persuading investors to fund an alleged retail profit-sharing business that was mostly paid out with other investors’ money. Her stepson, Daniel Olivares, was sentenced to two years in prison for his role as a senior technology officer.

Each pled guilty to one count of investment fraud conspiracy, and Dawn Olivares also pled guilty to one count of tax fraud conspiracy in February 2014. An estimated 900,000 investors lost money in the Olivares’ scam.

They, along with Paul Burks, ran Zeekler, an internet-based penny auction company. They convinced investors that their company was generating significant retail profits from its penny auctions, and that investors could share in the profits through investment.

Instead of actual profit sharing, the money was used to pay older investors, while Burks took home $10.1 million and the Olivareses received $14.6 million.

Call a Los Angeles Stock Fraud Attorney Today

If you invested with Zeekler, ZeekRewards, Dawn Olivares or Daniel Olivares, you may have certain legal rights that require your immediate attention.

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

 

Image showcasing a house made from dollars, metaphor for a ponzi scheme.

How to Avoid Ponzi Schemes and Scams

dkradmin

When you invest your money, the goal generally is for your investments to provide you a “positive return” – in other words, a profit on your investment. It stands to reason, therefore, that the more money you can make on an investment can make an investment more attractive.

This is precisely what many Ponzi (or “pyramid”) schemers rely upon: investors’ desire for investment returns that are significantly greater  than those provided by traditional investments vehicles.

Generally speaking, ponzi schemes and scams invest little to none of your money in the purported investment. Instead, your money is used to pay the promised exorbitant “investment returns” to earlier investors. These payments fool early investors into believing the false promises of high returns with little risk. Investors then pump even more money into the scam after receiving these so-called investment returns. They also often convince others to invest in the scam. This may continue as long as people continue investing in the operation – years, or even decades, in some cases – which provides a continuing flow of new investor money that the fraudsters can use to pay “investment returns” to earlier investors.

If you are approached with an investment opportunity that seems too good to be true, it probably is. Be on the lookout for the following before investing: extremely high rates of return promised, especially from unregistered investments or unlicensed brokers; very complicated investment strategies, failure to provide the proper paperwork; and last but not least – difficulty receiving payments when asked.

Call a Los Angeles Ponzi Attorney Today

If you believe you have the victim of a Ponzi scheme, you are certainly not alone, and you may have certain legal rights that require your immediate attention.

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