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North Carolina men accused of Ponzi scheme, financial fraud

| Feb 28, 2014 | White Collar Crimes |

Two men in North Carolina are facing federal charges after allegedly administering a Ponzi scheme in that state. A U.S. regulatory agency, the Commodity Futures Trading Commission, is pursuing a complaint against the two men, who are accused of white collar crimes involved in soliciting 11 other people to trade in specific marketplaces. The scheme allegedly solicited about $2.3 million through fraud. The CFTC is seeking a variety of civil penalties against the men in connection with the financial fraud.

Authorities report that the two men were allegedly using money from newer investors to pay returns on money that had been invested earlier in the process. Regulators say they are increasing enforcement against this type of investment fraud, especially in the wake of the massive crimes committed by former NASDAQ chairman Bernard Madoff. That man was accused of manipulating more than a billion dollars in his Ponzi scheme.

Recent cases brought by the CFTC have resulted in major financial hits for those accused of perpetuating Ponzi schemes, thanks to the regulatory crackdown. Criminal restitution has been ordered in one recent scenario, in which a man allegedly misled five investors to give him $1.3 million. Other civil monetary penalties have also been levied in that particular case.

The defendants in this case are facing prosecution from the CFTC for falsely guaranteeing returns, promising unrealistic returns and even misrepresenting investment risks. Further, the pair allegedly used their purported profits for personal purchases instead of properly managing clients’ investments. The defendants could face a series of trading and registration bans, along with other serious legal penalties.

Those who are accused of white collar crimes should remember that regulatory agencies may get involved in such cases, in addition to criminal prosecutors. A North Carolina attorney may be able to provide additional information about the restitution and litigation aspects of a criminal trial for a white collar crime. These lawyers may be able to protect their clients’ rights as they are prosecuted by federal agencies and law enforcement groups.

Source: Forex Magnates, “US Regulator Charges Two Fraudsters for Running an FX Ponzi Scheme” Adil Siddiqui, Feb. 20, 2014

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