ATM LEASEBACK SCHEMES-- any insight?

[worried]

Some good news! (Well, in addition to scumbags Joel and Ed being in jail right now)...

http://www.nasi-receivership.com/wp-con ... -16-16.pdf

The Receiver has collected almost $11M with almost $2M more in the pipeline, plus he seems to be on the trail of some possibly valuable assets (The Oasis companies). That may still only provide about 10 cents on the dollar for recovery for many of you, but it's better than nothing, and better than some (including me) thought he would get. But... there's more... I was waiting to hear about this: The Receiver found 2 executives of City National Bank (which kept the NASI accts) were involved(!!!), they were investors in the scam themselves... The report is well worth reading...

Any news on the restitution hearing? Was it rescheduled? Vindictive minds want to know!

[The Observer]

Well, now that there are specifics on what the Oasis companies actually owned, this may explain partially where a lot of the NASI money was being invested and why there was a gap between what we had been told had been given to Joel and Ed by the victims and what was being reported as actual losses. That was quite a bit of equipment and it may go a ways in increasing the amount of the payback to the investors. Every penny is good news at this point.

[notorial dissent]

This does sound markedly better. The bank business is news to me, and could make a great deal of difference depending on how far the collusion went. I still think the Oasis and related companies rat hole will account for where a lot of the money went, providing they can track the records, always assuming they kept records. But all in all good news.

[Tednewsom]

Funny. I was thinking about the bank's involvement a couple days ago. I know that some of the victims were considering suing the bank (or banks) which handled the scam, and I figured, "Guys, you don't have a case. The pair of thieves had an account at the bank. They deposited money, they wrote checks, they deposited more money. It wasn't the bank's job to ask where it's coming from or where it's going. It's like a robbery victim suing a bar because the thief used 'stolen money' to buy a beer at the bar."

Ah-- BUT-- when there are two cooperative, high level executives of one bank handling most (or all) of the dough for two decades, AND those two bank guys were beneficiaries of the scam -- now you got sumthin'.

[worried]

At the risk of sounding like a conspiracy theorist (which I apparently am now)... it always bothered me that Joel kept the checks going OUT as fast as he could (well that's my impression anyway) deliberately sucking all the money out of the account and sending it to 'victims' instead of some offshore account. Were these bank execs part of that? Did they help him move funds and set up another acct as soon as the SEC swooped in on the original accounts? Is there any chance they helped Joel/Ed hide money in those final days when it LOOKED like checks were going to 'victims'?...

It's very possible they were just a couple of 'dumb' bank execs. The report doesn't say how high up they were. I know I spoke to someone at a bank one time years ago sitting at the 'excecutive' style desk and everything and I had to explain to her how to calculate percentages. I also work with a very smart fellow electrical engineer who used to be a bank teller (he didn't get to sit at the desk). So, anything is possible with these execs I think. It would be nice if the receiver found some hidden money...

[Chaos]

it always bothered me that Joel kept the checks going OUT as fast as he could

scams depend on at least some people being paid money in order to get new money to come in or the scheme collapses on itself.
if you are bothered by it, do not read moneymakers group messageboard. That's all that's posted there is 'I got paid' posts to suck new people in.

[noblepa]

It's very possible they were just a couple of 'dumb' bank execs. The report doesn't say how high up they were. I know I spoke to someone at a bank one time years ago sitting at the 'excecutive' style desk and everything and I had to explain to her how to calculate percentages. I also work with a very smart fellow electrical engineer who used to be a bank teller (he didn't get to sit at the desk). So, anything is possible with these execs I think. It would be nice if the receiver found some hidden money...

You also have to remember that, at many banks, almost everyone is a Vice President. I've worked for a couple of banks, and both times, my immediate superior was a VP, as were all the low-level managers in the IT department.

Now, if someone is a Senior VP, or Executive VP, or Cashier (not the same as a teller), then they are fairly high up in the ranks. But a large-ish bank may have several hundred VPs.

[NYGman]

I would agree, VP is a disposable title at a bank. Almost every salaried employee is a VP or above. Now the real heavy hitters are the MD's... Not that I would know

[notorial dissent]

My experience as well in working for the bank I worked at. VP was kind of an attaboy or girl and really didn't mean much even when it had senior or executive tacked on to it, just sort of attaboys with oak leaf clusters if you will. In a lot of cases I think they got the title in lieu of a real pay increase. So that title isn't really much of a cache if you will. I still remember one of the real VP's getting busted for a rather large, and embarrassing to the bank, fraud scheme he was running. All it takes is being in the right place with the right frame of mind and it is terrifying what you can get away with, and some of them did.

So it doesn't surprise be about the cohorts the boys may have had at the bank, certainly makes pulling stuff like this off a whole lot easier, particularly when you aren't all that bright to begin with. Will be interesting to see what comes of it, at least to me, and may really explain a whole lot of what happened. I still want to see the Oasis audits and inventory, the real ones.

I will say that one thing that does amaze me is that the IRS hasn't stuck their noses in at all yet that we know, may just be waiting for the Receiver to get done investigating and spending money and the dust to clear and then swoop in on the ones who were really playing fast and loose after all the heavy lifting has been done. The IRS has budget constraints too.

[CJOHNSON]

Attorney Michael P. Denver of Hollister & Brace, APC, along with attorney Robert L. Brace, has filed a class action complaint in Federal Court in Los Angeles on behalf of people who purchased ATM machines sold by Nationwide Automated Systems, Inc. (“NASI”). The complaint alleges that the two Calabasas-based principles of NASI, Defendants Joel Gillis and Ed Wishner, ran a Ponzi scheme at NASI for over 15 years, enticing investors from several states into buying ATMs located in various parts of the country which NASI then “leased-back” from the investors in exchange for “rent” generated by the $2.00 to $3.00 transaction fees paid each time the ATM was used. Defendants Gillis and Wishner have plead guilty to Federal crimes which they committed in the course of the alleged Ponzi scheme and they currently reside in Federal correctional facilities. The complaint alleges that Gillis and Wishner’s misconduct was known to, and substantially assisted by Defendant City National Bank (“CNB”). The complaint alleges that CNB is liable to the class members and must pay the class members’ damages. The class action complaint may be viewed http://www.hbsb.com/wp-content/uploads/ ... 8.16-1.pdf. Anyone who invested in NASI and who would like to assist in the investigation may fill out a NASI claim form that may be viewed http://www.hbsb.com/wp-content/uploads/ ... ion-1.pdf.

[NYGman]

Attorney Michael P. Denver of Hollister & Brace, APC, along with attorney Robert L. Brace, has filed a class action complaint in Federal Court in Los Angeles on behalf of people who purchased ATM machines sold by Nationwide Automated Systems, Inc. (“NASI”). The complaint alleges that the two Calabasas-based principles of NASI, Defendants Joel Gillis and Ed Wishner, ran a Ponzi scheme at NASI for over 15 years, enticing investors from several states into buying ATMs located in various parts of the country which NASI then “leased-back” from the investors in exchange for “rent” generated by the $2.00 to $3.00 transaction fees paid each time the ATM was used. Defendants Gillis and Wishner have plead guilty to Federal crimes which they committed in the course of the alleged Ponzi scheme and they currently reside in Federal correctional facilities. The complaint alleges that Gillis and Wishner’s misconduct was known to, and substantially assisted by Defendant City National Bank (“CNB”). The complaint alleges that CNB is liable to the class members and must pay the class members’ damages. The class action complaint may be viewed http://www.hbsb.com/wp-content/uploads/ ... 8.16-1.pdf. Anyone who invested in NASI and who would like to assist in the investigation may fill out a NASI claim form that may be viewed http://www.hbsb.com/wp-content/uploads/ ... ion-1.pdf.

I guess it was only a matter of time before someone brought suit.

[notorial dissent]

Ouch!! That's gonna hurt if they can pull it off, although there may be enough a hurdle there for them to get over it doesn't go anywhere. I really would like to know more about the bank officer's involvement though. This should probably lead to criminal charges against them at the very least.

[CJOHNSON]

The complaint has a lot of facts that are important. If you would like me to email you a copy please let me know.

[Chaos]

seems this would interfere with the receiver's already started job of getting money back to the victims.

[NYGman]

seems this would interfere with the receiver's already started job of getting money back to the victims.

The Class action seems to be targeting the Bank, due to the actions of its employees. The Bank, probably has deeper pockets than the individual investors the receiver is looking to recover from. I hadn't seen anything on the receiver going after the Bank, so it may be a parallel route.

Based on the complaint, it looks as if they are alleging that that a senior bank employee knew about the Ponzi Scheme, participated int eh Scheme, and hid the scheme from the bank to allow it to continue, so he, and his wife could benefit from the scheme. Without this employees actions, the Ponzi would have been discovered much sooner that it was. Therefore they are looking to the Bank, and its deep pockets to compensate them for the loss, that would have been less, had employees followed procedures, and done some rudimentary checks, as required under their own AML policy.

At least that is what I got from a quick scan.

[notorial dissent]

Since the bank and/or its employees/officers weren't named in the SEC action, the Receiver would have to go back and include them in the complaint, which isn't to say they can't or won't, but right now the bank is fair game to a class action suit. The only problem I can see here is that it was the officers/employees working on their own, and not really the bank who were part of the scheme, which might throw up some considerable difficulties, but on the other hand since they were doing it through the bank an argument could be made, whether it would fly I don't know. I've seen these kind of suits go both ways. There should however be a type of insurance the bank has that covers malfeasance by employees towards customers or the public that might be easily reached, how much it would cover I don't know. If they can prove the complicity, the SEC, FBI, and Comptroller at the very least will be VERY unhappy and start looking at things. That kind of malfeasance doesn't go over well. If the bank were majorly involved, it could explain where and how a lot of the money went elsewhere, and could make tracking it a lot easier. Bank examiners have exactly NO sense of humor about things like this. Somewhere right now there are a bunch of VERY unhappy lawyers, underwriters, and regulators.

[worried]

Attorney Michael P. Denver of Hollister & Brace, APC, along with attorney Robert L. Brace, has filed a class action complaint in Federal Court in Los Angeles on behalf of people who purchased ATM machines sold by Nationwide Automated Systems, Inc. (“NASI”). The complaint alleges that the two Calabasas-based principles of NASI, Defendants Joel Gillis and Ed Wishner, ran a Ponzi scheme at NASI for over 15 years, enticing investors from several states into buying ATMs located in various parts of the country which NASI then “leased-back” from the investors in exchange for “rent” generated by the $2.00 to $3.00 transaction fees paid each time the ATM was used. Defendants Gillis and Wishner have plead guilty to Federal crimes which they committed in the course of the alleged Ponzi scheme and they currently reside in Federal correctional facilities. The complaint alleges that Gillis and Wishner’s misconduct was known to, and substantially assisted by Defendant City National Bank (“CNB”). The complaint alleges that CNB is liable to the class members and must pay the class members’ damages. The class action complaint may be viewed http://www.hbsb.com/wp-content/uploads/ ... 8.16-1.pdf. Anyone who invested in NASI and who would like to assist in the investigation may fill out a NASI claim form that may be viewed http://www.hbsb.com/wp-content/uploads/ ... ion-1.pdf.

Ohhh this is SO AWESOME!!!... I just HAVE to post a couple excerpts from the middle of this complaint:

"44. CNB’s knowledge of the scheme perpetrated by the RICO Defendants was derived primarily from Fitzwilliam the Branch Manager who conspired with the RICO Defendants with knowledge of the scheme. In or about November 2006, Fitzwilliam and his wife, Betty Saleh Fitzwilliam (aka Betty Lynn Saleh (hereinafter “Betty Saleh”), conducted a detailed due diligence investigation into the specific facts regarding the ATM business operated by the RICO Defendants. Based on their due diligence, they concluded that: (i) NASI was the world’s one and only
honest ATM leaseback business; or (ii) NASI was a Ponzi scheme that was safe to invest in so long as Fitzwilliam was able to monitor the NASI accounts at CNB. As detailed below, this husband and wife team were more than wiling to knowingly engage in criminal behavior for their own benefit, making the latter conclusion more likely than the former.
45. At all times material to this case Betty Saleh, Fitzwilliam’s wife, had a social relationship with Jill Wishner, Edward Wishner’s daughter-in-law. Just like Edward Wishner, Betty Saleh was an expert in stealing other people’s money with the use of lies and fabricated customer account statements. ....

... 47. At all times material to the establishment of knowledge for aiding and abetting liability for CNB for the crimes committed by the RICO Defendants, Brian Fitzwilliam was living in a San Fernando Valley cesspool of corruption with his wife Betty Saleh and his sister-in-law Debbie Saleh—two siblings with no moral barometer, practicing their deceit from positions of corporate influence to obtain easy money from trusting clients."

This is amazing stuff. The bank branch manager and his wife actually EXTORTED Joel and Ed, KNOWING that Joel and Ed were committing crimes... too rich... There are so many more details in the document, you have to read it. I always agreed with TedNewsom that an enterprise like NASI couldn't go on that long and haul in THAT much money without attracting some attention from other criminals... Is this as far as it went?... Will we get a clue as to why Joel (through CNB) was so frantically devoted to sending out checks to 'investors' even as the SEC was asking him to step back from his computer?... Wow,... just wow... I hope TedNewsom's acquaintance is still working on that documentary, this story is getting more interesting...

A thought: maybe it wasn't Joel who was so frantic to keep money going 'out'... maybe it was the bank manager... Note that the bank manager and his wife were in on this from the VERY BEGINNING... but, according to how the complaint reads, Brian Fitzwilliam (BF) was careful to make it APPEAR that he and his wife were just plain old innocent 'investors' in the beginning. It was only later when they got desperate for money that they made it more obvious that they were extorting(using?) NASI.

[Judge Roy Bean]

...

Ohhh this is SO AWESOME!!!... I just HAVE to post a couple excerpts from the middle of this complaint:

I would not be too excited.

Consider it just the first serve in a tennis match in which you don't see where the ball lands and you won't even see the opponent's response for a while.

Few aces are served at the complaint stage of trials. But that never deters counsel for the plaintiff to write them as if they are 100+mph serves.

[worried]

I do certainly appreciate what you're saying. The complaint has a lot of sensationalizing language (entertaining though isn't it?), and a LOT of repetitious statement of facts about Joel and Ed that have already been established....

BUT,.. BUT... we now have a REALLY GOOD reason for why Joel was still recruiting victims and collecting MILLIONS$ while, and AFTER, his bank account was frozen.... The BANKER was the one who was so focused on keeping payments going out BECAUSE HE WAS PAYING HIMSELF! The banker set up the new account and kept the money going out. Joel and Ed didn't get any of it. That, at least, explains that well enough for me (assuming at least the basic facts of the complaint are true).

I would point back to the Loss Analysis list and note how many investors were long-time owners of only 1 or 2 "ATM"s. We don't have insight into the "winner" list to see how many "winners" also were long-time owners of only 1 or 2 atms and therefore too small for the Receiver to go after, but I think it's reasonable to expect that the numbers are about the same. I am still surprised that THAT many people who were able to be conned into a Ponzi scheme were not tempted to keep buying more after so many years of happily receiving checks. It seems contradictory to me that a person is not disciplined enough to consult a real financial adviser before falling for "guaranteed 20% returns", but IS disciplined enough to stay diversified and not give in to the temptation to weight their savings more heavily in such a sure winner. This banker showed himself to be conniving just based on what's in the complaint. Are some of those long-time "winners" fake? That may be unlikely you say, but it's worth looking into. In the end the banker and his wife were receiving checks from 20 "ATMs", that's "only" about $4000-$5000/month. To me, that's a lot of money, but for a banker and his wife living in one of the most desirable neighborhoods in Southern California, used to living the high life (probably driving Mercedes, etc.), that's almost pocket change. Maybe that's all THEY were getting. Are they the only other people who were on the receiving end of a siphon? They were already in trouble for other mis-dealings. I know I'm wandering into conspiracy land here, but, sometimes to figure things out you have to imagine/identify some possible answers in order to be able to investigate them. Did someone else have hooks in the banker and his wife? I don't have the time right now to dig up all the numbers from the reports we saw months ago. But I remember interpreting the numbers such that there was a LOT of money unaccounted for even after adding up all the money withdrawn directly from the bank accounts by Joel and others for their cars, trips, meals, etc. I'm just sayin'... we have an explanation for the strange obsession with getting checks out even AFTER the SEC and FBI had seized computers and bank accounts, but is there more there?

[worried]

IF the allegations against the banker and his wife are true, that makes him a bigger criminal than Joel or Ed in my mind. It's alleged that the banker used his position to act as a reliable and independent reference for anyone seeking to exercise 'due diligence' before investing in NASI. That, and the fact that he and his wife were in on the scam from the VERY BEGINNING, first disguising themselves as innocent investors, but later getting ALL their principal investment back but still receiving siphoned funds, COULD be construed to suggest that it was the BANKER who was really running the whole show with Joel and Ed as visible front-men (now the fall-guys). There's still a lot of money missing, and it's possible we have a bigger crook than the 2 guys who are in jail now... I bet CNB upper management and legal team are scrambling right now.

Any better conspiracy theories out there? ...

EDIT for correction-takeback: Sorry, getting ahead of myself.... the banker was NOT in on the scam from the beginning. In my mind I equated the 2006/2007 timeframe (when the banker got involved) with the 1996/1997 beginning of NASI....

But, still, the banker's actions at a certain point revealed that he knew he had the power over Joel/Ed to demand he get his money back AND keep getting paid through what he THOUGHT was a clever way to hide what he was doing. He helped KEEP the scam going (according to the complaint) when it was about to fail some years ago... But, those are unproven allegations right now. I'm just a little excited and getting ahead of myself like I said. It would be nice to find some money for victims. But, it's a shame for an otherwise (assumed) innocent bank ((assumed) innocent shareholders) to be held accountable for this guy's actions. I'll try to contain myself and let the process work. But at least we know, right now, there are a couple of eager, energetic, and hopefully savvy, lawyers snooping around looking for that money now in addition to the Receiver.