ATTORNEY NEWSLETTER
Ponzi Schemes Increasingly Target Older Investors
One Red Flag: Promises of Guaranteed High Returns
In a Ponzi scheme, fraudsters use money they collect from new investors to pay existing investors. What appears to be a return on your investment is actually money from another investor who has been swindled. Increasingly, we see stories of Ponzi schemes and other orchestrated fraud luring senior investors. The California and Marin securities fraud and financial elder abuse attorneys at Evans Law Firm, Inc. can represent you if you lose money in a Ponzi scheme or as the result of annuity fraud, insider trading, securities misrepresentations or nondisclosures, accounting fraud or any other type of securities fraud or financial elder abuse here in California. If you have, call our lawyers today at (415)441-8669.
Just recently, the Department of Justice (DOJ) announced details of one such scheme against the elderly where the defendant has now admitted targeting elderly investors.[1] According to the DOJ, defendant solicited primarily elderly investors for over nine years to invest their money in a company which defendant allegedly represented was staffed by experienced real estate professionals that invested in real estate ventures. Defendant allegedly convinced senior investors that they could share in the company’s investment portfolio by lending it money to invest. Investors were supposedly promised to receive a guaranteed monthly income in return. In reality, the company had no employees, no real estate portfolio, and the monies used to pay investors as a purported return on their investments was from funds received from other investors. Defendant allegedly used funds sourced from investors to pay his personal and unrelated business expenses, including paying his child’s college tuition and sorority fees.
Before investing in any new venture, check for classic warning signs of a Ponzi scheme:
- Promises of High Returns with Little or No Risk. Guaranteed high investment returns are the hallmark of a Ponzi scheme. Every investment has risk, and the potential for high returns usually comes with high risk. If it sounds too good to be true, it probably is.
- Unlicensed and Unregistered Sellers. Most Ponzi schemes involve individuals or firms that are not licensed or registered. Even if an investment professional comes across as likeable or trustworthy, use the free search tool on Investor.gov to check whether the person is licensed and registered. Also do a broker check at brokercheck.finra org.
- Overly Consistent Returns. Investment values tend to fluctuate over time. Be skeptical of an investment that generates steady positive returns regardless of market conditions. That was one of the hallmarks of Bernie’s Madoff’s huge Ponzi scheme.
Contact Us
If you or a loved one has been the victim of a Ponzi scheme or other form of financial elder abuse by an insurance agent, stock broker, investment advisor, promoter or other person here in Marin County or elsewhere in California contact Ingrid M. Evans and the other California financial elder abuse attorneys at Evans Law Firm at (415) 441-8669, or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. Our attorneys also have experience with complex financial contracts and large insurance companies. We can help guide your case through filing a complaint, investigation and discovery through trial or an equitable settlement. We also handle cases involving physical and financial elder abuse, nursing home abuse, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.
[1] Evans Law Firm, Inc. was not involved in the case in any way.
