Two California antique art dealers were arrested and charged with operating a Ponzi scheme that took in more than $3 million from investors. Anthony Barreiro, 64, and Ernest Ray Parker, aka Ray Parker Gaylord, 50, were each charged with 12 counts of conspiracy, mail fraud and wire fraud. As each of the charges carries a maximum twenty-year prison, the pair potentially faces hundreds of years in prison.
Barreiro and Parker operated Charles Gaylord & Co. ("Charles Gaylord"), an antique business, and ARTLoan Financial Inc. ("ARTLoan"). The pair allegedly solicited investments for ARTLoan, telling potential investors that their funds would be used to provide lending capital to borrowers seeking to finance expensive artwork. Investors were promised regular interest payments over the life of their loan, and were assured that ARTLoan would maintain possession of the encumbered artwork as collateral. In the event of default, ARTLoan would purportedly have the right to forfeit the artwork for the benefit of investors. In total, the pair raised more than $3 million from investors.
However, according to authorities, these representations were false, and ARTLoan did not use investor funds to finance the purchase of artwork nor did the company secure artwork as collateral in connection with the alleged loans. Instead, the pair is accused of operating a Ponzi scheme by using investor funds to make the purported interest payments, thus giving off the appearance of a successful venture. During the duration of the scheme, nearly $2 million in Ponzi payments were made to investors.
Both Barreiro and Parker posted bond and are scheduled to next appear on February 11, 2014.
For more news and analysis of Ponzi schemes, visit Ponzitracker, a blog by Jordan Maglich, an attorney at Wiand Guerra King P.L.
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