ATM LEASEBACK SCHEMES-- any insight?

[Hyrion]

Money's like energy: it can't be "destroyed" only transmitted or transformed.

I disagree. I've seen many pennies smushed by trains. I've seen money damaged in other ways to the point it's unusable and therefore destroyed - such as forgetting that $5 bill in your pants pocket when you did the laundry. As a result, bad analogy.

I swindle you out of $30,000-- the money is transmitted. I buy a new Corvette with the dough, the money has been transformed.

While it's true that some money is "converted" into goods, other is "converted" into services. The oil change on your vehicle immediately comes to mind as an example of both.

And while some goods retain value of some form or other (some a loss in value, some an increase, some can first loose value then gain) some goods retain no value. That sandwich you bought for lunch and ate certainly no longer has value to others if you upchuck it.

But these crooks would be dumber than a bag of hammers if they didn't siphon off a healthy chunk of change all along the way -- and "transform" it into something other than cash.

It's been my experience the average persons expenditure habits revolve around living paycheck to paycheck. They earn more, they just increase their spending in one form or another. Granted, I don't know anyone beyond the middle class range so perhaps those earning $1 mill or more per year have better expenditure habits.

The guys in question: what were their expenditure habits?

Point being, the money trail was not a dead-end path from the sucker to the bank.

If it was, it'd be easier for the receiver to recover.

But let's face a bit of reality: the Receiver isn't going to go after the restaurant to recover the $130 paid for lunch even if the guilty parties did keep the receipt.

[webhick]

There's been an imbalance that was kind of puzzling to me. I recall early on that either one of the Receiver reports or the criminal complaint mentioned that Wishner pulled more money out of NASI than Gillis. The thought occurred to me that Wishner may have been running two scams. The Ponzi, and then skimming off the Ponzi.

Gillis would provide a list of what to pay each investor to Wishner. Wishner prepared NASI's tax returns. He was a signatory on the bank accounts and signed the bulk of the checks. He was the registered agent of the Relief Defendants, to which large sums of money were loaned and then "forgiven." The books were a mess. Wishner held back (either intentionally or through incompetence) Oasis and NASI paperwork and then tried to cover it up. Wishner's partner in the Oasis stuff (Keller) has been super uncooperative. Keller loaned a large sum of Oasis money to his daughter.

[Tednewsom]

Money's like energy: it can't be "destroyed" only transmitted or transformed.

I disagree. I've seen many pennies smushed by trains. I've seen money damaged in other ways to the point it's unusable and therefore destroyed - such as forgetting that $5 bill in your pants pocket when you did the laundry. As a result, bad analogy.

You've seen the symbols of wealth reduced to moosh. A five-spot is not inherently worth more than the total of a piece of paper and some ink. It is its ephemeral purchasing power that gives it its worth. It IS cool to put a penny on a railroad track, though.

But these crooks would be dumber than a bag of hammers if they didn't siphon off a healthy chunk of change all along the way -- and "transform" it into something other than cash.

It's been my experience the average persons expenditure habits revolve around living paycheck to paycheck. They earn more, they just increase their spending in one form or another. Granted, I don't know anyone beyond the middle class range so perhaps those earning $1 mill or more per year have better expenditure habits.

The guys in question: what were their expenditure habits?

Not particularly extravagant, if any of the information thusfar is an accurate clue. This might just indicate they were not exactly living paycheck to paycheck.

Point being, the money trail was not a dead-end path from the sucker to the bank.

If it was, it'd be easier for the receiver to recover.

But let's face a bit of reality: the Receiver isn't going to go after the restaurant to recover the $130 paid for lunch even if the guilty parties did keep the receipt.

Yeah, you have a point. Why should the receivers bother with any of it? The 150 acres of land out in Palmdale near the reservoir. Or the factory in Mexico. Or the fleet of vintage Hudsons stored in a warehouse in Pacoima, the Argentinian municipal bonds, all under miscellaneous phony names and thrice-dummy corporate dodges. Nah. Too much bother. It's best just to say, "It all disappeared."

[notorial dissent]

What it boils down to is not that the money was spent, that was pretty much a given from the very start. What is critical/important is what the money was spent on. If they "invested" in things like Fuel Doctor, then the money is most likely pretty well GONE, if they invested in real going businesses and in actual investments, then an entire new vista could well open up.

If my understanding of how these things work, then I don't know if the Receiver is the one who will have to go back to court to get to these entities, or it the SEC will have to be the one to do it. I don't see that there will be any further progress made until that information is gathered, and based on their luck so far with Oasis, I don't expect it to be quick and/or easy.

[Gregg]

Just for what its worth, in the USA, money is destroyed by the Fed, when they sell bonds on the open market. Defaced currency and coin can be redeemed by sending the remains to the US Treasury. If there's enough left to identify it, they'll send you a new one. Really, shred a ten spot and send it to them, it works.

In other countries, and it varies, but its the same, when the central bank sells securities it reduces the money supply, or destroys money. When they buy securities, they increase the money supply because they issue currency or electronic funds to buy said securities. When they sell, they take in the currency or electronic money and retire it reducing the money supply.

And that is the only way, other than unrecoverable loss or damage, which is negligible, that money is destroyed in most places.

[Lost Income]

Like I said, the Receiver has yet to recover significant monies for returning to investors ("suckers" as referred by the perfect person in here) and does not have the means to find any cash. So meantime, the crooks continue living outside the jail on money they are getting from somewhere because our legal system can't get around to sentencing them, and the Receiver can't use force to persuade the crooks into revealing what any cash is been stored. Awesome system!!

[Tednewsom]

You don't like "suckers"? Sorry. I thought it was clearer than "marks," and a trifle kinder than "chumps."

No one ever wants to admit they've been a sucker. There comes a time when you need to face it. It's not complicated, and there's not much point in being overly polite. Wishner and Gillis were grifters. Their clients were suckers.

[Judge Roy Bean]

... and the Receiver can't use force to persuade the crooks into revealing what any cash is been stored. Awesome system!!

You'd prefer thumb-screws or branding irons? Perhaps water-boarding?

The only "force" in this case - threatening additional years of incarceration - may not work when someone is facing what may amount to a life sentence.

[webhick]

The Receiver must be busy doing something. He hasn't updated the site since April and it used to be that he'd have his report, etc posted nearly same day.

[Lost Income]

I don't appreciate the word suckers, but then that's to be expected from some inconsiderate asshole that has nothing else to do but write lengthy useless conjecture in here.

And yes, an angry investor in an empty room with Joel & Ed, could find out more info in 15 min than the Receiver will ever find.

[Hyrion]

A five-spot is not inherently worth more than the total of a piece of paper and some ink. It is its ephemeral purchasing power that gives it its worth. It IS cool to put a penny on a railroad track, though.

And yet... if you try to convert that paper lint from the dryer into a bottle of pop - it's ephemeral purchasing power is gone and you'll fail. So you had a $5 spot of purchasing power available, you washed and dried it, you no longer have it available. If you still think that value hasn't been destroyed then you and I have very different definitions of destruction.

But let's face a bit of reality: the Receiver isn't going to go after the restaurant to recover the $130 paid for lunch even if the guilty parties did keep the receipt.

Yeah, you have a point. Why should the receivers bother with any of it? The 150 acres of land out in Palmdale near the reservoir. Or the factory in Mexico. Or the fleet of vintage Hudsons stored in a warehouse in Pacoima, the Argentinian municipal bonds, all under miscellaneous phony names and thrice-dummy corporate dodges. Nah. Too much bother. It's best just to say, "It all disappeared."

My point was: While the receiver will be able to go after something, they won't go after everything. Any of the rest of your paragraph dealing with such things as factories and fleets are all your opinion, not mine. In short, if you understood what I said to mean the receiver shouldn't go after a factory you're very mistaken on both what I said and intended to say.

This speaks directly to your conclusion of:

Ergo-- they invested their dough elsewhere during the course of the scam.

While they may have invested money elsewhere, they didn't invest it all. And those funds that were spent on non-investing (whatever percentage that may be, small or large) I seriously doubt the Receiver will go after.

So... there's the question for you: you conclude they invested money elsewhere. What percentage of what they took in do you believe they invested?

[webhick]

Since we're talking about whether or not the boys lived paycheck to paycheck or invested, I should throw this out there:

When the gov't froze the accounts, Ed's personal account only had $800 and Joel's had almost $30k. It was another oddity considering that since 2013, Joel took $208k and Wishner took $793k out of NASI. The balance sheet for April 2013 showed that Oasis owed NASI $1.477 million.

[Tednewsom]

Gosh. Well, either the boys learned that Crime Doesn't Pay, and they were indeed scraping by month to month worrying every day that the landlord would drop by... or they were squirrelling all their dough away for 17 years. Hmm. Let's see... I wonder... flat-broke, like they claim... or lying crooks, as they are accused...? Hmmm.

Hyrion's question is an imponderable.

So... there's the question for you: you conclude they invested money elsewhere. What percentage of what they took in do you believe they invested?

There's no way to tell what was used to pay their mortgage or buy a daughter a restaurant, what was spent on drinks at a country club seminar, and what was funneled away into other endeavors or locations... without a forensic pursuit of the numbers. Which, of course, is what the Receiver is trying to do.

The more interesting question is, how much did they skim? And if Gillis was telling anything near the truth when he said (repeatedly) that they bought an "ATM" for every ATM an investor bought (read: one share in the scam's ongoing profits for every investor's share), then it's so mathematically simple, even Wishner could figure it out. Half.

[grimreaper]

The Receiver must be busy doing something. He hasn't updated the site since April and it used to be that he'd have his report, etc posted nearly same day.

The latest report on itemized expenses and fees indeed shows that they're *reconstructing* the *check book ledger* and all
payments to investors. An arduous task indeed, but we should see demand letters issued sooner rather than later. Stay tuned.

[Hyrion]

Well, either the boys learned that Crime Doesn't Pay, and they were indeed scraping by month to month worrying every day that the landlord would drop by... or they were squirrelling all their dough away for 17 years.

Another possibility:

• They were living it up as they went along.

After all... if one has the money available, why wouldn't one rent that 30 foot yacht for a business party to see if they can get a few more "investors" on board.

Additionally, the above 3 situations aren't mutually exclusive. They could have been scraping by in their home finances from month to month (I seriously doubt that, but it is in the realm of possibilities) while at the same time investing some of the funds for the future (whether personal or for business purposes) while at the same time spending some of it to impress other "investors".

I can't think of another possibility outside those 3 at the moment with regards what they did with the finances, but I doubt the 3 possibilities that are listed are the only options.

[Judge Roy Bean]

...

I can't think of another possibility outside those 3 at the moment with regards what they did with the finances, but I doubt the 3 possibilities that are listed are the only options.

I don't think you're giving them enough credit for being able to come up with ways to protect their wealth. It isn't rocket science but good legal advice is not cheap. On the other hand, good illegal advice might be expensive and it may even be risky but the fact is, tens of thousands of people have millions or perhaps even billions well out of the reach of the US and state governments.

[The Observer]

Ted floated this theory that "money" cannot be destroyed several months ago, and I went through an explanation of why that was wrong and provided several examples of how "money" could be destroyed. Ted went silent on that issue at that time. Now he is resurrecting it again in pursuit of his argument that there must be humongous wads of money out there that Wishner and Gillis are just sitting on.

Ted is ignoring the first law of Ponzi schemes: you have to pay the marks who first signed up with the money of the marks who joined later. And as the spreadsheet exercises have shown, that means a majority of the money is flowing back to the victims in increments. At this point Ted is going to stand up and start mocking this claim by saying that Ed and Joel then were just running the scheme out of the goodness of their hearts. But that is not the lesson here. Of course Ed and Joel were skimming money, but they were not skimming as much as Ted would like to think they were skimming.

How much were they skimming? And where did it go? Good questions, but the best answer anyone has at this point is pure speculation. We won't know until the receiver provides some figures. And that certainly won't answer the question of where is that money that got skimmed. In all likelihood we may never know the complete truth.

It is certainly possible that NASI funds went towards the purchase and support of a restaurant. But if it did, and the restaurant is operating in the red and has no equity to pursue, then this is a place where any money that was invested is destroyed.

There was mention of a possible link to money being loaned to a relative out of NASI funds. Again, if the relative turns out to be judgment proof, then this will be another place where money was destroyed.

Money placed in Fuel Doctor and other shaky investments? Looks to me like another place where money was destroyed.

And if Ed and Joel were extremely smart and played Rope-A-Dope with investors and investigators, then trying to recover any more monies off shore is going to a very interesting and expensive chase, and little chance that the money be recovered? Result? Destruction of money, at least in relation to the victims.

Another possibility:

They were living it up as they went along.

Yep, pointed that out as a possible destruction source of money to Ted. Lots of Ponzi schemers love to spend the money as soon as it comes in. Sometimes they do it on purpose as another way to convince potential marks that the grifter must know what he or she are doing, since they are living an attractive lifestyle. Sometimes they just spend the money on expensive trips, nice dinners, leased sportscars and mansions, etc. because they know that this scheme will eventually crash, so they might as well live it up until the crash occurs. Note that there is no recovery of this money spent on the above items. The money is gone.

Does that mean that Ed and/or Joel didn't squirrel any money away? Of course not. There is every possibility that they did put money away in some place where no one can find it - or at least where Ed/Joel think no one can find it. So the receiver should look where ever it may be practical to look. But looking and finding are two different things. And the difference between the two can be astronomical.

[Gregg]

I don't appreciate the word suckers, but then that's to be expected from some inconsiderate asshole that has nothing else to do but write lengthy useless conjecture in here.

And yes, an angry investor in an empty room with Joel & Ed, could find out more info in 15 min than the Receiver will ever find.

Its just too damn bad they didn't do this in some 16th century loving third world shithole where it'd be legal to amputate the hands to find the money and then behead them for the punishment, oh, and stigmatize their offspring for about 3 generations, eh?

It may seem like the end of the world to some victims, not just because they lost, but their is a certain amount of shame having to admit you fell for something like this. And for some the amounts are life changing, but in the grand scheme of things, this is a minor scam, involving just a few people and not much money, perpetuated by people who because of their age are in a strange way punishment resistant, they're of an age where anything beyond a token sentence can be a life sentence.

But I'll call around and see if we can get them extradited to Saudi Arabia....

[Lost Income]

Thanks for more of your inconsiderate asshole comments. It must be interesting to live in your perfect world.

[Hyrion]

...

I can't think of another possibility outside those 3 at the moment with regards what they did with the finances, but I doubt the 3 possibilities that are listed are the only options.

I don't think you're giving them enough credit for being able to come up with ways to protect their wealth. It isn't rocket science but good legal advice is not cheap. On the other hand, good illegal advice might be expensive and it may even be risky but the fact is, tens of thousands of people have millions or perhaps even billions well out of the reach of the US and state governments.

Question: How did you understand what I authored?

Because my intent was only to show there are many possibilities of where the money could have gone. And that the receiver will not go after all of those. That's it. I did not ever say "they did not save anything in a location out of reach of the US". Here's an incomplete list of possibilities:

• A) Moved out of reach of the US

• B) Spent on functions to bring in more investors

• C) Went to pay employee wages/bonuses

• D) Spent frivolously out of petty cash for personal use and not business use

• E) Spent on company overhead

That's just a quick list off the top of my head to show there's more then 1 place the money could have gone.