Tednewsom wrote:Several people here have indicated-- hell, stated flat-out-- that all the ill-gotten gains are gone, that there is no money. Seems to me that's impossible to know, unless magically the forensic accountants zipped through the maze of 18 years worth of paperwork in a week.
Of course it is impossible to know for sure, but given the past history of these types of schemes, there is typically litle or no money left for the victims.
Here is another Ponzi scheme reported on yesterday, with some particulars:
Cincinnati Business Courier September 23, 2014
Another Cincinnati Adviser Admits to Running Ponzi Scheme
By Steve Watkins
Another Cincinnati investment adviser has pleaded guilty to charges related to running a Ponzi scheme.
John Bullar, 52, who ran Executive Management Advisors in Cincinnati, pleaded guilty in U.S. District Court on Tuesday to one count of wire fraud and one count of money laundering. He admitted to running an $8.7 million Ponzi scheme, bilking local investors out of their money. The charges carry a maximum sentence of 20 years in prison and a fine of up to $250,000.
Bullar ran the scheme for seven years, from 2006 to 2013, according to court documents. He brought in the $8.7 million from between 10 and 50 investors, according to a U.S. Attorney’s Office press release. Investors lost between $2.5 million and $7 million in the scheme, federal attorneys said.
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Bullar’s case was similar in that he, too, targeted friends and family as investors, lied about his firm’s performance and kept most of the money investors gave him.
Prosecutors say Bullar told clients he never had a losing quarter and that he was the company’s biggest investor, so his money was invested along with theirs.
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“In reality, Bullar had invested only a small amount of the money that he received from clients, using the vast majority of the money to pay other investors and his own personal expenses,” the U.S. District Attorney’s Office said in a news release.
Bullar aimed to make the operation look legitimate by giving investors quarterly statements that showed their investments were making a profit. He sent client 1099 forms that reported gains, meaning they had to pay taxes on gains that didn’t exist. He also created an investment blog and installed a TV and three computer monitors in his home office to give the appearance that he was constantly monitoring the market.
Bullar invested just $580,000 of the $8.7 million, according to federal prosecutors. He never invested the rest. He used investor money to buy a house, pay for vacations, country club dues, boats, jet skis, sports tickets and vehicles, prosecutors said.
It is pretty clear that the money is gone in Bullar's scam. It went everwhere except into a bank account that can be taken and counted. I don't expect that it will be any different with NASI's situation when the dust settles.
That's also discounting the cleverness of the two principals. They weren't in it altruistically. Yes, the company was paying out plenty, but they were also taking in plenty. Yes, they clearly pissed away a few million here and there on things like Fuel Doctor-- but for outsiders or even investigators to proclaim one week after seizing control that "there's no money" is absurd.
You know, you can scroll through the last 40-some odd posts and see some of the victims with this belief. "There was so much money going to NASI, it has to be somewhere. It can't just be gone!" There are comments from some that indicate that they are holding onto the myth that that somehow NASI was an ongoing business and that we just need to preserve the machines and the location contracts and then run it for however long it takes until the investors are paid off. And there are other comments regarding the ability to liquidate NASI and recover the investments. None of this is absurd in light of what we already know?
I understand their emotion is involved in this, that some part of them thinks by denying the truth of the matter, somehow they are going to avoid a lot of pain and loss. That is just part of being a human. But it doesn't change the truth of the matter. What is absurd is to know that that checks bounced and still somehow believe that there is money available. If NASI was bouncing checks, that is a pretty good sign to me that the money was gone. The fact that NASI didn't issue replacement checks is another good sign that the money is gone. The fact that the lies about how many machines NASI owned are coming to light is another sign that the money is gone. In fact there are more signs about the money being gone rather than being there is proably another sign in of itself. So I don't think it is absurd to say that the money is gone.
[It also inflames an already bleak and complex situation.
I would disagree; leading people to believe that somehow they will recover their losses is wrong and disingenuous. A bleak and complex situation will be inflamed even worse if they are given false hope and encouragment to hold on to their myths. They need to get out of the denial stage and accept the truth.
