In many cases, the operators of financial frauds and Ponzi Schemes the world over rely on people who have already been duped to bring in new suckers. Of course, the ones touting the services of a particular fraudster have no idea they’ve not only been deceived, but that they are helping weave an even larger web of deception. While it’s appealing to let others pick your advisor for you, the best thing to do is ‘trust but verify’ all financial opportunities.
We may never forget Madoff’s crimes. Let’s hope we don’t. And yet, investors still fall prey to so-called “mini-Madoffs” every day all over the country. If you keep your eye on the financial press, particularly news from regulators such as the SEC or FINFRA, Ponzi schemes identical in nature and structure — if not scope — to Madoff’s bubble up and burst too often to keep track.
An investor gets introduced by mutual friends to a financial professional who almost immediately begins pitching the investor on an amazing opportunity. Because the investment professional seems like a good guy or gal, and because he or she was introduced by someone the investor already knows and trusts, the investor unconsciously transfers that sense of trust to the broker or hedge fund manager or mutual fund whiz. The investor’s guard is already down. What happens next?
A judge in Virginia federal court ordered a former broker and his alleged accomplice, former Philadelphia Eagles linebacker Merrill Robertson Jr., to forfeit $8 million. The money was allegedly generated by Robertson and Sherman Vaughn Jr. through the operation of a Ponzi scheme which lasted from 2009 to 2016.
No, it's not the Polka King of Pennsylvania but something far more prosaic. Last week, according to complaint released by the Securities and Exchange Commission (SEC), a former stockbroker based in Wayne, PA has been sentenced to more than 5 years in prison for operating a $2.35 million ponzi scheme that involved 30 investors.
Financial fraudster are getting more creative - and audacious, according to a recent Investor Alert from the FINRA (the Financial Industry Regulatory Authority). FINRA is in charge of keeping an eye on the US Securities Industry. Shockingly, scam artists have recently been using FINRA itself - or its name at least - to separate investors from their money.
Last week, federal prosecutors in North Carolina brought charges against Stephen C. Peters, the latest alleged Ponzi operator to hit the headlines. Peters has been charged with diverting more than $4.4 million of retirement savings from elderly investors. Rather than actually invest their money, Peters used it to remodel a ranch in North Carolina, purchase fine art, build a vacation home in Costa Rica, and buy horses.
Green, Schafle & Gibbs has launched an investigation into the alleged Ponzi Scheme operated by Philadelphia-area stockbroker Paul W. Smith. Based in Wayne, PA, Smith operated a long-running Ponzi Scheme using purported investments in The Haverford Group, which costs a group of mostly retired and elderly investors approximately $2.35 million, according to the SEC.
Our firm currently represents former customers of Malcolm Segal who lost a significant amount of money in one of his fraudulent or nonexistent CDs. If you or anyone you know may have been damaged by Segal’s scheme, please contact our experienced securities litigation attorneys immediately to protect your legal rights.