Tag Investment Fraud

HYIPs Definition, Examples And Prevention

High-yield investment programs (HYIPs) are investment schemes that promise high returns on investments in a short period of time. They often use flashy marketing strategies to attract investors and typically target individual investors through online platforms or other means of…

Who Is Legally Responsible for Credit Card Scam

Cyber and malware attacks are very common today in the finance industry. Detecting them is complicated and hard. Regular implementation of protective measures against new attacks is necessary.  Traditional protective measures such as CVV2 and one-time passwords are not effective…

Financial Fraud

Financial Fraud: Antonio Buzaneli Sentenced Sentenced In Investment Fraud Scheme Involving Brazilian Factoring

Florida Executive Sentenced To 20 Years In Prison For Orchestrating $150 Million International Ponzi Scheme United States Attorney Erica H. MacDonald today announced the sentencing of ANTONIO CARLOS DE GODOY BUZANELI, 57, to 240 months in prison for his role in a $150 million investment fraud scheme involving Brazilian factoring. BUZANELI, who entered his guilty plea on April 19, 2018, was sentenced today before Senior Judge Michael J. Davis in U.S. District Court in Minneapolis, Minnesota. BUZANELI’S co-conspirators, JOSE MANUEL ORDOÑEZ, JR., 48, was sentenced on January 23, 2019, to 120 months in prison and JULIO ENRIQUE RIVERA, 62, will be sentenced on April 16, 2019. U.S. Attorney Erica MacDonald said, “Antonio Buzaneli was the primary architect of a $150 million Ponzi scheme that targeted hundreds of victims worldwide, many of whom were elderly and vulnerable. Some victims lost their retirement savings, others lost the ability to provide a college education to their children or grandchildren. For these egregious crimes, Mr. Buzaneli will spend the next 20 years behind bars. I applaud our law enforcement partners for their steadfast efforts in seeking justice for the victims.” “No matter how complex the scheme, the FBI is committed to stopping fraudsters like these from preying on people, especially elderly investors who may have lost their life savings in this case,” said Jill Sanborn, Special Agent in Charge of the FBI’s Minneapolis Division. “We are grateful for our partners at the U.S. Attorney’s Office, the United States Postal Inspection Service and the Minnesota Commerce Fraud Bureau for thoroughly investigating this global scheme and bringing these criminals to justice; and we believe this matter further illuminates the need for citizens to be wary of those peddling these kinds of fraudulent business investments.” “Our securities enforcement unit and the Commerce Fraud Bureau began investigating this […]
Financial Fraud

Financial Fraud: DENNIS GIBB Pleaded Guilty To Falsification Of Records Within The Jurisdiction Of The Securities and Exchange Commission (SEC)

Long-Time Redmond, Washington Investment Advisor Pleads Guilty to Defrauding Investors of more than $3 Million Admits Falsifying Financial Statements – Used Investor Money for Own Expenses A long-time investment advisor in Redmond, Washington pleaded guilty today in U.S. District Court in Seattle to defrauding some 15 investors of more than $3 million, announced U.S. Attorney Brian T. Moran. DENNIS GIBB, 72, the President and owner of Sweetwater Investments Inc., pleaded guilty to wire fraud and falsification of records with the intent to obstruct a matter within the jurisdiction of the Securities and Exchange Commission (SEC). Simultaneously, GIBB and Sweetwater investment entered into a consent decree with the SEC liquidating the Sweetwater Income Flood LP Fund and barring GIBB from further investment activity. Chief U.S. District Judge Ricardo S. Martinez scheduled sentencing in the criminal case for June 28, 2019. “Sadly, this defendant sold his investors a dream of a safe retirement, representing that he would use a sophisticated investment strategy, including investing in government bonds, to produce stable returns. Instead, Dennis Gibb used investor funds to pay business expenses for Sweetwater Investments, as well as mortgage and car payments and other living expenses,” said U.S. Attorney Brian T. Moran. “He told investors there was $7.8 million in the fund – the reality was there was less than $2 million. The investors no longer have the safe retirement income they were promised.” According to the criminal case filings and the SEC consent decree, GIBB created Sweetwater Income Flood Limited Partnership, a private fund Gibb managed, in 2008. As early as 2007, he began soliciting investors for the fund targeting those who wanted steady retirement income in the near future. According to the SEC between 2007 and 2018, about 20 investors put about $7.3 million into the fund. GIBB secretly transferred more […]
Investment Fraud

Investment Fraud: Donald Watkins Sr. And Jr. Plead Guilty On Multiple Charges For Their Roles In Investment Fraud And Bank Fraud Schemes

Father And Son Conviceted of Multimillion-Dollar Investment Fraud Scheme BIRMINGHAM – A federal jury found a father and son guilty Friday of multiple charges for their roles in investment fraud and bank fraud schemes in which they stole over $10 million from individual investors—including multiple former professional athletes – and Alamerica Bank of Birmingham, Alabama. Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Jay E. Town of the Northern District of Alabama and Special Agent in Charge Johnnie Sharp Jr. of the FBI Birmingham Field Office made the announcement. Donald Watkins Sr., 70, of Atlanta, Georgia, was convicted on seven counts of wire fraud, two counts of bank fraud and one count of conspiracy. Donald Watkins Jr., 46, of Birmingham was convicted on one count of wire fraud and one count of conspiracy. Sentencing is set for July 16 before U.S. District Court Judge Karon O. Bowdre of the Northern District of Alabama, who presided over the trial. “The jury’s verdict today sends a clear message: Donald Watkins Sr. and Donald Watkins Jr. are frauds, plain and simple,” said Assistant Attorney General Benczkowski. “They induced their victims to part with more than $10 million of supposed ‘investment capital’ and used it to support their lavish lifestyle. I want to thank the prosecutors and law enforcement agents for their hard work investigating and prosecuting this case.” “This was a case about deception and greed at the expense of too many,” said U.S. Attorney Town. “The findings of guilt for these two individuals should forewarn anyone who would seek to defraud investors so brazenly. We appreciate the labor of the jurors whose role as citizens in this process is so critical to our system of justice. We are also grateful to the Alabama Securities Commission and […]
Investment Fraud

Investment Fraud: DAVID MIDDENDORF And JEFFREY WADA Convicted Of Wire Fraud Charges In Connection With Their Scheme To Defraud The PCAOB

Former KPMG Executive And Former PCAOB Employee Convicted Of Wire Fraud For Scheme To Steal And Use Confidential PCAOB Information Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced that DAVID MIDDENDORF, who was the National Managing Partner for audit quality at the accounting firm KPMG LLP (“KPMG”), and JEFFREY WADA a former employee of the Public Company Accounting Oversight Board (the “PCAOB”), were convicted of wire fraud charges in connection with their scheme to defraud the PCAOB by obtaining, disseminating, and using confidential lists of which KPMG audits the PCAOB would be reviewing so that KPMG could improve its performance in PCAOB inspections. U.S. Attorney Geoffrey S. Berman said: “As this trial revealed, David Middendorf and Jeffrey Wada were two links in a chain of corruption, where confidential PCAOB inspection information was taken at the behest of high-level executives at KPMG so they could cheat on inspections. This confidential information was critical to the PCAOB and its core mission of ensuring audit quality. As a unanimous jury found, the actions of Middendorf and Wada defrauded the PCAOB.” According to the evidence presented during the trial: The PCAOB is a nonprofit corporation overseen by the SEC that inspects the audit work performed by registered accounting firms (“Auditors”) with respect to the financial statements of publicly traded companies (“Issuers”). The PCAOB inspects the largest U.S. accounting firms on an annual basis. As part of the inspection process, the PCAOB chooses a selection of audits performed by the accounting firm for a closer review, commonly referred to as an inspection. Until shortly before an inspection occurs, the PCAOB does not disclose which audits are being inspected, or the focus areas for those inspections, because it wants to ensure that an Auditor does not perform additional work […]
Investment Fraud

Investment Fraud: William B. McHenry Indicted For His Role In a Multi-Million Dollar Ponzi Scheme

Canton Man Charged as Part of Largest Ponzi Scheme in Mississippi History Fraud Affected Hundreds of Victims Across Multiple States Jackson, Miss. – William B. McHenry, 71, of Canton, has been indicted by a federal grand jury for his role in a multi-million dollar Ponzi scheme that adversely affected hundreds of victims across multiple states over a number of years, announced U.S. Attorney Mike Hurst and Special Agent in Charge Christopher Freeze with the Federal Bureau of Investigation in Mississippi. McHenry appeared before U.S. Magistrate Judge Linda R. Anderson today for his initial appearance and arraignment on the Indictment. The case is currently scheduled for trial on April 15, 2019, before U.S. District Judge Carlton W. Reeves in Jackson. “Those who prey upon and steal from others will soon find themselves on the wrong side of the law. We will continue to investigate this massive scheme wherever the evidence may take us and will vigorously pursue and bring to justice any other wrongdoers who were involved,” said U.S. Attorney Hurst. McHenry is charged with one count of securities fraud and two counts of wire fraud involving a scheme to defraud investors, all in connection with a Ponzi scheme using Madison Timber Properties, LLC, a company wholly owned by Arthur Lamar Adams. Adams has previously been convicted and sentenced for his role in the Ponzi scheme. As charged in the Indictment, beginning as early as 2008 and continuing through April 2018, McHenry assisted in a scheme to defraud investors by soliciting millions of dollars of funds for Adams under false pretenses, failing to use the investors’ funds as promised, and converting investors’ funds to McHenry’s and Adams’s own benefit without the knowledge of the investors. Instead of investing McHenry’s clients’ money, Adams used the invested funds for his own personal benefit […]

Financial Fraud: SHAWN BALDWIN Convicted to Fraudulently At Least 15 Investors And Lenders

Chicago Investment Manager Convicted on Federal Fraud Charges for Swindling $10 Million from Clients and Lenders CHICAGO — A federal jury today convicted a Chicago investment manager on fraud charges for swindling more than $10 million from clients and lenders. SHAWN BALDWIN, who owned and controlled various investment firms in Chicago, exaggerated his financial success and professional connections to fraudulently obtain more than $10 million from at least 15 investors and lenders. Baldwin falsely claimed that their funds would be invested in stocks and other investment products, when in reality he spent the money for his own personal benefit. Baldwin’s fraud scheme began in 2006 and continued until 2017. The jury in U.S. District Court in Chicago convicted Baldwin, 53, of Olympia Fields, on seven counts of wire fraud. U.S. District Judge John Robert Blakey set sentencing for July 9, 2019. The conviction was announced by John R. Lausch, Jr., United States Attorney for the Northern District of Illinois; and Jeffrey S. Sallet, Special Agent-in-Charge of the Chicago office of the Federal Bureau of Investigation. The government is represented by Assistant U.S. Attorneys Matthew Getter, Heidi Manschreck and Michelle Petersen. According to evidence presented at trial, Baldwin obtained funds from individual investors, as well as from corporate lenders who lent him money for use in business and personal dealings. Baldwin claimed that compliance officers and professional advisors were affiliated with his firms, when no such relationships actually existed. Baldwin also deceived investors and lenders by misrepresenting and minimizing the serious disciplinary actions taken against him by regulators. The regulatory actions included the revocation of his certifications with the Financial Industry Regulatory Authority in 2009, and a permanent prohibition from offering securities sales or investment advice, which the State of Illinois imposed in 2013. Evidence at trial further revealed that Baldwin […]