LexisNexis® Legal Newsroom
Zeek Receiver Issues Update, Will Seek Court Approval for Claims Process by End Of March

The court-appointed receiver overseeing the recovery of funds for victims of the $600 million ZeekRewards Ponzi scheme issued an update today to address several pending issues. Kenneth D. Bell, the Receiver, posted a three-page letter on the court-approved website, www.zeekrewardsreceivership.com...

After Two Days of Trial, Florida Man Agrees to Plead Guilty to $10 Million Ponzi Scheme

In an unlikely turn of events, a Florida man decided to change his plea from 'not guilty' to 'guilty' on the third day of his trial, effectively ending the trial. George Elia, 69, made his decision after hearing a morning of testimony from a number of his victims and several more ...

Former Exorcist/Attorney/Bishop Sentenced to 11-Year Term for Role in $6 Million Ponzi Scheme

A former New York attorney who also claimed to be a trained exorcist and bishop was sentenced to 11 years for his role in a Ponzi scheme that duped investors out of over $6 million. James Lagona received the sentence from United States District Judge William M. Skretny, who dismissed Lagona's...

SEC Loses Claimed Ponzi Scheme Case at Trial

The SEC lost a claimed Ponzi scheme case following a bench trial in a decision handed down late last week. The complaint alleged that a privately held exploration company defrauded promissory note investors by misrepresenting or not disclosing the use that would be made of the offering proceeds in...

Utah Man Pleads Guilty To Running Two Separate Ponzi Schemes

A Utah man agreed to plead guilty for his involvement in two separate Ponzi schemes - while on parole for a previous conviction for a third Ponzi scheme - that took in more than $30 million from investors. Wayne Ogden, of Koosharem, Utah, was convicted earlier this year for his role in one of the...

Ponzi Scheme Defendants Agree to Pay $55M in Investment Club Action

WEST PALM BEACH, Fla. - (Mealey's) A federal judge in Florida on April 24 signed consent orders in which defendants agreed to pay nearly $55 million to end a suit in which the U.S. Commodity Futures Trading Commission (CFTC) alleged that they orchestrated a $28 million Ponzi scheme to defraud...

Zeek Receiver Blasts Objections to Claims Process

"Hundreds of thousands of Zeek victims have waited patiently for months as the Receiver has completed the work necessary to provide an easy to use, fair and efficient claims process. But yet again, it appears that counsel pursuing their own agenda has come forward to delay and raise the costs of...

Former Youth Pastor Gets 51 Months in $3.4 Million Jewelry Ponzi Scheme

A former youth pastor was sentenced to serve 51 months in federal prison for masterminding a Ponzi scheme purporting to buy and sell precious jewels. Matthew James Addy, 34, received the sentence from United States District Judge James C. Cacheris after previously pleading guilty to a single count...

SEC Alleges Texas Man Ran $4.5 Million Bitcoin Ponzi Scheme

The Securities and Exchange Commission has filed civil fraud charges against a Texas man, accusing him of masterminding a Ponzi scheme using the virtual currency known as Bitcoin that promised annual returns exceeding 300%. Trendon T. Shavers, 30, was charged with violations of federal securities laws...

42-Year Sentence For Mastermind of $200 Million Ponzi Scheme

A California man that orchestrated a Ponzi scheme that took in more than $200 million from victims has been sentenced to a 42-year prison term. Shasta County Superior Court Judge Bradley Boeckman handed down the sentence to James Koenig, 60, after a jury convicted Koenig of thirty-five criminal charges...

Grand Juror Indicted After Tipping Off Ponzi Schemer

A federal grand juror is facing criminal charges after he allegedly disclosed details regarding the investigation and indictment of a suspected Ponzi schemer to a witness during a chance encounter at a local Costco - which resulted in the witness tipping off the fraudster. Terry Jones, of Des Moines...

Appeals Court Affirms 20-Year Sentence for Florida Man in $19 Million Ponzi Scheme

The Eleventh Circuit Court of Appeals agreed that a federal judge was justified in departing from federal sentencing guidelines in handing down the maximum statutory sentence to a Florida man who masterminded a Ponzi scheme that defrauded more than 500 victims out of $19 million. David Lewalski received...

SEC Halts $800 Million Ponzi Scheme Targeting Japanese Investors

The Securities and Exchange Commission ("Commission") announced the filing of an emergency action freezing the assets of a Nevada company suspected of perpetrating an $800 million Ponzi scheme directed at Japanese investors. Edwin Fujinaga, who resides in Las Vegas, Nevada, and his company...

Supreme Court Court Hears Oral Argument in Stanford Ponzi Scheme-Related Cases

WASHINGTON, D.C. — (Mealey’s) Attorneys for Latin American investors in Stanford International Bank (SIB) and SIB’s insurance brokers and lawyers asked the U.S. Supreme Court on Oct. 7 to determine whether the Securities Litigation Uniform Standards Act (SLUSA) and the Securities Exchange...

Trial Set to Begin Tuesday for Madoff Employees

Five of Bernard Madoff's closest employees are set to begin trial on Tuesday to face charges that they played key roles in assisting Madoff orchestrate the largest Ponzi scheme in history. Jury selection is set to begin Tuesday for the five, who consist of three of Madoff's most tenured employees...

SEC Stops $20 Million Pyramid Scheme Touting Youth Education Courses

The Securities and Exchange Commission announced it had obtained an asset freeze and filed civil fraud charges against the operators and promoters of a worldwide pyramid scheme that targeted Asian-Americans through the allure of risk-free returns based on the sale of internet-based youth educational...

Is the SEC Here to Help Defrauded Victims in a Ponzi Scheme, Or Not?

The Securities Exchange Commission (SEC) plays an active role in protecting the rights of investors. Its own mission statement is: The mission of the Securities and Exchange Commission is to protect investors; maintain fair, orderly, and efficient markets; and facilitate capital formation. Yet...

SEC Files Two Offering Fraud Cases

Offering fraud and Ponzi scheme cases have, in recent years, become a staple of the SEC enforcement division. Some of these cases are simple shams where the promoters lure unsuspecting investors with tales of quick, easy and safe returns. Others are more complex, involving ventures which actually have...

SEC Wins Freeze Order Over “Cloud Computing” Pyramid Scheme

The “cloud” is a current focus for investors. There is cloud computing, cloud storage and new firms with cloud services. And the Commission discovered a “cloud” investment program that promised a 100% return in 100 days and had its own secondary market. The program raised $65...

SEC Efforts to Compel SIPC Coverage For Stanford Victims Rejected

The D.C. Circuit rejected efforts by the SEC to compel the Securities Investor Protection Corporation to liquidate a broker-dealer that was part of the Stanford Ponzi scheme empire. The investors had purchased CDs from an off-shore Stanford entity. The Circuit Court affirmed the decision of the District...

Government Seeks to Stay Discovery in TelexFree SEC Case Pending Criminal Resolution

The U.S. Department of Justice ("DOJ") has sought to intervene in the civil enforcement action brought against TelexFree by the Securities and Exchange Commission on the basis that a stay of civil discovery is appropriate pending resolution of parallel criminal proceedings against certain former...

More Broken Windows: The SEC and Ponzi Schemes

Investment fund fraud actions – those in which investors are convinced to part with their hard earned cash on the promise of good, often guaranteed but illusory returns — have become a staple of SEC enforcement. Sometimes the scheme is an offering fraud. In other instances the scheme is more...

SEC Brings Another ATM Based Ponzi Scheme Case

Ponzi and investment scheme cases are a staple of SEC enforcement in the post Madoff world. Emerging, however, may be a new trend based on a subset of these frauds – investments in ATM machines. At the close of last month the Commission filed an investment fund fraud case centered on the solicitation...

SEC Wins Summary Judgment Ruling in Ponzi Scheme Case

The Commission prevailed in an investment fund scheme action, obtaining a favorable summary judgment ruling. In reaching its conclusion the Court rejected claims that the action was time barred and that the cause of action was outside the scope of Exchange Act Section 10(b). SEC v. Funinaga, Civil Action...

SEC Files Offering Fraud and Ponzi Scheme Cases

A staple of SEC enforcement in recent years has been offering fraud and Ponzi scheme cases. This week the Commission filed two more of these actions, one an offering fraud targeting military personnel and a second and investment fund fraud case which virtually told investors it was a Ponzi scheme. SEC...