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Clawback Defendants File Counterclaims Against Receiver, Seek Treble Damages and Fees

In a novel strategy, several "net winners" facing claims that they received millions of dollars in false profits from the $600 million ZeekRewards Ponzi scheme have responded to the court-appointed Receiver's complaint by asserting various counterclaims against the Receiver - a strategy...

Attorney and Daughter Charged With $23 Million Ponzi Scheme

"Ninety-nine percent of cases we see are caused by unregistered investments or investment advisors. The best thing investors can do is check with our website or call our office to make sure the investment is registered and the person they are dealing with is registered." - Indiana Secretary...

Defendant Tries to Bring Gun to Sentencing Hearing For $2.5 Million Ponzi Scheme

A South Carolina pastor that admitted to operating a $2.5 million Ponzi scheme is accused of trying to bring a gun to his sentencing hearing - a hearing that he had twice tried to delay. Archie Evans, 42, was scheduled to learn his fate before U.S. District Judge R. Bryan Harwell after pleading guilty...

June 2014 Ponzi Scheme Roundup

Below is a summary of the activity reported for June 2014. The reported stories reflect: 7 guilty pleas or convictions in pending cases; over 137 years of newly imposed sentences for Ponzi schemers; at least 8 newly discovered schemes allegedly involving over $147 million; and an average age of approximately...

Former Banker Charged For Role In $1.2 Billion Rothstein Ponzi Scheme

He assisted in soliciting investors. He assisted in helping me handle the bankers. He assisted in helping me prepare fake opinion letters. He assisted me in coming up with plans of action to deceive investors and others. He assisted me in moving money between accounts in order to facilitate the Ponzi...

Can a Receiver and a Trustee, Who Are the Same Person, Settle with Himself?

Thomas J. Petters’ $3.65 billion Ponzi scheme has raised all kinds of interesting legal issues, the most recent of which involves the interplay between Thomas Petters’ individual receivership estate and the bankruptcy of Petters’ companies. David Kelley was first appointed as the receiver...

Appeals Court Rules Stanford Victims Ineligible For SIPC Coverage

A federal appeals court affirmed that victims of Allen Stanford's massive $7 billion Ponzi scheme - the second largest scheme in history behind only Bernard Madoff's scheme - are not "customers" of Stanford's American-based bank and thus not eligible to seek compensation from the...

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...

Florida Cop Gets 5-Year Sentence For Rothstein Ties, Including Illegal Arrest

"Mr. Benjamin, while wearing the cloak of BSO authority, engineered the arrest and incarceration of an innocent citizen. This was done purely for financial gain. This conduct is deplorable — it is unconscionable." - U.S. District Judge James Cohn A former Broward County Sheriff's...

Rothstein Ponzi Scheme: A Settlement, Finally

The intersection of bankruptcy and forfeiture proceedings can lead to considerable fighting over the assets that were once in the possession and control of the perpetrator. The recent filing of a motion to approve a settlement in the hard fought battle over forfeited assets in connection with the Scott...

TelexFree Founders Indicted on Fraud Charges

A Massachusetts grand jury indicted TelexFree co-founders James Merrill and Carlos Wanzeler on multiple fraud charges in what authorities have alleged was a massive Pyramid/Ponzi scheme that may have defrauded victims out of hundreds of millions of dollars. Merrill and Wanzeler were charged with one...

July 2014 Ponzi Scheme Roundup

Below is a summary of the activity reported for July 2014. The reported stories reflect: 10 guilty pleas or convictions in pending cases; over 20 years of newly imposed sentences for people involved in Ponzi schemes; at least 8 newly discovered schemes allegedly involving over $440 million and over 25...

Appeals Court OK's $67 Million Verdict Against TD Bank For Rothstein Ties

An appellate court has affirmed a $67 million verdict obtained by victims of Scott Rothstein's $1.2 billion Ponzi scheme against banking giant TD Bank, upholding what is likely the only decision to impose liability on a banking institution for aiding and abetting a Ponzi scheme. The U.S Court of...

John Elway Among Victims to Receive Distributions in $147 Million Ponzi Scheme

The court-appointed receiver tasked with recovering assets for victims of a $150 million Ponzi scheme has announced that victims, including former NFL star John Elway, may soon share in a $10 million distribution from recovery efforts. Receiver C. Randel Lewis has filed a distribution plan in a Colorado...

The Problem with Multiple Accounts in Ponzi Scheme Clawback Actions

Can different but related account holders offset losses in one account against gains in another account? Can a husband and wife with separate accounts offset losses in one account against gains in the other? When there is a family trust, can the trustee and beneficiary offset gains in the trust account...

California Man Fires Lawyer; Claims He Was Forced to Plead Guilty to $125 Million Latex Glove Ponzi Scheme

Due to be sentenced for masterminding a $125 million Ponzi scheme, a California man instead told a federal judge that he wanted to fire his lawyer, claiming he had been "intimidating" him and had coerced his guilty plea. Deepal Wannakuwatte, 63, had previously pleaded guilty to a single count...

Feds: Ponzi Schemer Hid $400,000 in Gold, Silver, and Cash With Wife and Brother

Federal authorities announced criminal charges against a convicted Ponzi schemer, as well as his wife and brother, for conspiring to hide more than $400,000 in gold, silver, and currency in ammunition canisters out of the reach of authorities. Ronnie G. Wilson, Cassie Wilson, and Tim Wilson each face...

Accused of $100 Million Ponzi Scheme, Utah Man Walks Free On Technicality

A Utah federal judge dismissed criminal charges against a Utah man accused of operating one of the largest Ponzi schemes in Utah history, ruling that prosecutors' failure to timely pursue the case was a violation of federal law and warranted dismissal. Rick Koerber was originally indicted in 2009...

Tennessee Man Gets 14-Year Sentence For $18 Million Ponzi Scheme

A Tennessee man was sentenced to serve the next fourteen years in federal prison after pleading guilty to masterminding an $18 million Ponzi scheme. Terry Kretz, 61, received the sentence from U.S. District Judge Todd J Campbell, and was also ordered to pay nearly $15 million in restitution to defrauded...

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...

Convicted $200 Million Ponzi Schemer Wins Resentencing After Appeals Court Tosses Two Convictions

An Indianapolis man currently serving a 50-year prison sentence for masterminding a massive Ponzi scheme that caused more than $200 million in losses will be resentenced after a federal appeals court reversed two of his wire fraud convictions based on prosecutor "oversight." Timothy Durham...

August 2014 Ponzi Scheme Roundup

Below is a summary of the activity reported for August 2014. The reported stories reflect: 10 guilty pleas or convictions in pending cases; over 138 years of newly imposed sentences for people involved in Ponzi schemes; at least 5 newly discovered schemes; and an average age of approximately 55 for the...