After making a plea deal admitting to the sale of unregistered securities in March, Allen County, IN, resident Bradley Collins was sentenced last week to two years of work release and six of probation for promoting a $46.5 million Ponzi scheme. The 56-year-old Collins had originally been indicted in October of 2012 on additional charges… Continue Reading
Category Archives: Ponzi Analysis
Subscribe to Ponzi Analysis RSS FeedAmerican Ponzi: The Blur Between Fantasy and Reality
Posted in Ponzi Analysis, Ponzi ProfilesWhile a work of fiction, the following report is a composite narrative based on actual events taken from real-life Ponzi schemes. Links are to stories Hackard Law has previously covered. California hedge fund wizard and snow-cone king Gonzo Wiggler, 50, was indicted by a federal grand jury today on multiple counts of conspiracy, fraud and… Continue Reading
Good Friday
Posted in Ponzi AnalysisAs much as we at Hackard Law enjoy pointing out the more ridiculous aspects of Ponzi schemes, their dark side is also readily apparent. Along with other types of fraud, the Ponzi scheme is not just theft, for at its core is the lie. Deceit defines this crime, and it’s a tactic that allows scammers… Continue Reading
Contingency Fees, Adversary Claims and Ponzi Cases
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisThe contingency fee system is a litigation reality unique to the United States. This system plays a significant role in the selection and prosecution of civil cases, including the prosecution of adversary claims against investors and/or victims of Ponzi schemes. While it is true that contingency fees can allow the poor and impoverished a “key… Continue Reading
Interview with Chuck Malkus, Author of The Ultimate Ponzi
Posted in Book Reviews, Ponzi Analysis, Ponzi ProfilesThe Ultimate Ponzi The Scott Rothstein Story By Chuck Malkus. Illustrated. 250 pp. Pelican Publishing Company. $26.00. The Ultimate Ponzi: The Scott Rothstein Story is available for order at Barnes & Noble and Amazon.com. *** Today Hackard Law interviews public relations executive and communications expert Chuck Malkus, author or The Ultimate Ponzi, a chronicle of… Continue Reading
Good Judgment Comes from Experience…
Posted in Ponzi AnalysisAnd experience comes from bad judgment. As news headlines attest every week, many people get burned by Ponzi schemes. There’s also an unwarranted assumption about victims of investment fraud: that they somehow deserved to get scammed, that they were stupid and greedy. Yet in a great number of cases, neither accusation is true. Let’s take… Continue Reading
Avoidance Actions against Investors in Ponzi Schemes: The Fundamentals Revisited
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisU.S. District Judge David Godbey’s 32-page Order allowing the Receiver in the R. Allen Stanford Receivership Estate to “clawback,” or recover, all back interest payments paid to Stanford investors is a worthy read as a remedial lesson in the character of Ponzi-based clawback actions. Court-appointed receivers often file lawsuits or clawback actions against investors who were… Continue Reading
Ponzi Schemes Harm Local Ethnic Communities
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisAs investment frauds continue to make the news across American cities, a clear pattern emerges among a number of these scams. Ethnic communities are often the target of Ponzi schemers and form a key segment of affinity fraud victims. These groups can fall prey to scams due to the following factors: A smaller subsection of… Continue Reading
Affinity Fraud and Clawbacks: Lydia Cladek’s Ponzi Scheme
Posted in Bankruptcy Clawback News, Ponzi Analysis, Ponzi ProfilesThe case of St. Augustine Ponzi schemer Lydia Cladek provides a clear example of how con-artists develop relationships with victims in order to steal their money. When the scheme eventually comes crashing down, friends, family and associates who had invested with the perpetrator can face nasty clawback lawsuits. After being found guilty of conspiracy and several… Continue Reading
Ponzi Schemes in Paradise: Hawaii Hit by Tsunami of Scams
Posted in Ponzi Analysis, Ponzi ProfilesAccording to an FBI agent working out of the Bureau’s Honolulu field office, “Hawaii is experiencing an absolute epidemic of investment frauds”. In an interview with the Star-Advertiser, Special Agent Tom Simon commented on an alarming surge of Ponzi schemes in the Aloha State. He noted that for a population of only over 1 million,… Continue Reading
Accused Ponzi Schemer Vincent Singh Was Provided a Federal Public Defender
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi Analysis, Ponzi ProfilesOn October 17th, the day after his arrest in Idaho, accused Ponzi schemer Vincent Thakur Singh was provided a federal public defender during his detention hearing. Singh has been indicted by a Federal Grand Jury in Sacramento for numerous counts of fraud – the detention hearing documents indicate that he will seek court-appointed counsel when… Continue Reading
Ponzi Schemes and Political Campaigns
Posted in Bankruptcy Clawback News, Ponzi Analysis, Ponzi ProfilesSince America is in the grip of election-season fever, it’s worth taking a look at some connections between investment fraud and the national political scene. Many Ponzi schemers are by their nature gregarious, flashy individuals whose moral compass doesn’t seem to function very well. Their actions are calculated to increase profit, power and pleasure, and… Continue Reading
Vincent Singh Ponzi Bankruptcy Tests Validity of Usury Claims in Clawback Litigation
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisToday at Forbes, attorney and top authority on investment fraud Jordan Maglich has delivered an excellent analysis on the use of lending laws in clawback suits. Maglich examines the recent employment of usury statutes by Court-Appointed Trustees to seize funds from investors in the wake of a Ponzi scheme’s bankruptcy. A trustee or receiver will… Continue Reading
Ponzi Schemes and Clawbacks: Defending the Victims, not the Perpetrators
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisThis legal overview of Ponzi schemes and clawbacks was written by Michael Hackard for The Bella Institute in August 2012. See the original entry. Something’s been proliferating across America – something that has at times shaken investor confidence and at others made financial investors feel like there is a war against them. That which has… Continue Reading
New IRS Rules for Clawbacks
Posted in Bankruptcy Clawback News, Legal Representation, Ponzi AnalysisGetting hit with a clawback lawsuit after being the victim of a Ponzi scheme is a double-whammy. And while we seldom look to the taxman for good news, the IRS has published new rules for Ponzi scheme victims who then went on to suffer clawback lawsuits from a court-appointed trustee. Responsible for administering the Ponzi… Continue Reading
Book Review: Preference Defense Handbook, The Circuits Compared
Posted in Book Reviews, Ponzi AnalysisDeborah L. Thorne, Preference Defense Handbook, The Circuits Compared, American Bankruptcy Institute (Alexandria, VA., 2010), 178 pp. (paper). Preference Defense Handbook is helpful for lawyers whose practices have expanded into defending preference avoidance actions in bankruptcy cases. The wake of economic hardship brought on by the Great Recession has made preference litigation far more common…. Continue Reading
Ponzi Scheme and Bankruptcy FAQ
Posted in Ponzi AnalysisWhat is a Ponzi scheme? The Securities and Exchange Commission defines a Ponzi scheme as an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. In other words, it’s a business scam that robs Peter to pay Paul. Organizers of Ponzi schemes will pitch their… Continue Reading
Analyzing Ponzi Schemes
Posted in Ponzi AnalysisCollecting evidence on the major characteristics of Ponzi schemes is no easy task, since new cases of investment fraud are exposed on a weekly basis. In a recent report released by the business consulting firm Marquet International, 329 Ponzi schemes from 2002-2011 were collated and analyzed. Let’s examine some of the key points featured in… Continue Reading
Ponzi Schemes and Fraud: Terminology
Posted in Ponzi AnalysisMaybe you’re not acquainted with all the ins and outs of investment terminology. While there are special names for investment programs and securities documents, your biggest asset in avoiding fraud is common sense. A Ponzi schemer might try and impress you with sophisticated-sounding buzzwords so that you’ll buy into his con. He’s hoping your greed… Continue Reading
Reality Check for Investors: Steering Clear of Fraud
Posted in Ponzi AnalysisThe SEC has a simple and effective checklist for potential investors. Given that fraud is an everyday phenomenon, it’s important to protect yourself. When you consider your next investment opportunity, remember to ask these five basic questions: 1) Is the seller licensed? Run a FINRA BrokerCheck to determine if the solicitor of the potential investment… Continue Reading
Ponzi Scheme Red Flags, Part II
Posted in Ponzi AnalysisIf you do your homework right, you’ll find clues pointing to a Ponzi scheme in operation. First remember that tried and true rule of thumb: If it sounds too good to be true, it probably isn’t true. Once you apply this principle to various aspects of a potential investment, it will be easier to spot… Continue Reading
Ponzi Scheme Red Flags
Posted in Ponzi AnalysisThere are a number of “red flags” that should tip off any potential investor about a Ponzi scheme in the works. Before sign onto any investment program, be aware of warning signs that fraud is afoot. Use a general rule of thumb: If it sounds too good to be true, it probably isn’t true. Here… Continue Reading