Alleged Scheme Lasted Seven Years
Invested Money Allegedly Funded Lavish Lifestyle
Supposed High-Yield Investments Were Non-Existent
Financial predators may target older investors with unsuitable or risky ventures promising high returns. These predators may seize on senior anxiety about the stock market, their need for income in the future, escalating inflation, and the ever-rising cost of long-term care. The offered investment “opportunity” may be a risky, unregistered investment or an outright Ponzi scheme, where money collected from new investors is used to pay existing investors, and there really is no actual investment of funds at all. Unregistered investments sold to unqualified investors or fraudulent pyramid or Ponzi schemes all violate securities laws and, when the victims are seniors, constitute financial elder abuse and may involve other crimes. See Penal Code § 368 and Cal. Welf. & Inst. Code § 15610.30 (definition of financial elder abuse). Evans Law Firm, Inc. can represent you if you lose money in a Ponzi scheme or any other type of securities fraud or financial elder abuse in Los Angeles or elsewhere in California. If you have, call our lawyers today at (415)441-8669. Our toll-free number is 1-888-50EVANS (888-503-8267).
Recent Arrest Of Former IRS Agent For Alleged Ponzi Scheme
A former IRS agent and current tax professional was arrested earlier this year and accused of running a Ponzi scheme that defrauded an elderly woman of more than $1 million over seven years. According to police, the alleged Ponzi scheme consisted of making small interest payments to her old investors/victims from new investors, while using most incoming “investment” funds to allow for her lavish lifestyle. The victim initially reported the alleged fraud in December 2020, telling police she had entrusted a significant amount of funds to an acquaintance to invest on her behalf. The woman told police she met the suspect in 2012 through a mutual friend. Following the report, police said the department’s property crimes units obtained search warrants for the suspect’s home as well as at her employer’s office, seizing boxes of financial documents and correspondence. Over 12 months following the initial search warrants, detectives served additional search warrants, combed through additional documents and electronic communications, and interviewed additional victims, police said. Detectives also audited bank accounts and thousands of transactions over the course of several years for the victim and suspect. According to police, the victim had lost more than $1 million over a seven-year period to the suspect. The victim told police she believed she was investing in lucrative, high-yielding opportunities. When she no longer had any funds to invest and asked for her money back, the suspect’s demeanor and communications raised the victim’s suspicions, police said. The suspect was arrested on 22 counts of financial elder abuse and three counts of money laundering. She is awaiting trial.
“Red Flags” Of Ponzi Schemes
Here are some of the classic “red flags” of Ponzi schemes like the one involved in the reported case:
- High or overly consistent returns with little or no risk. Be especially suspicious of any “guaranteed” investment opportunity like the promise allegedly made in the reported case. Investments tend to go up and down over time. Be skeptical about an investment that regularly generates positive returns regardless of overall market conditions.
- Unregistered investments. Ponzi schemes typically involve investments that are not registered with the SEC or with state regulators. Registration is important because it provides investors with access to information about the company’s management, products, services, and finances.
- Issues with paperwork. Account statement errors may be a sign that funds are not being invested as promised.
- Difficulty receiving payments. Be suspicious if you don’t receive a payment or have difficulty cashing out. Ponzi scheme promoters sometimes try to prevent participants from cashing out by offering even higher returns for staying put.
If you or a loved one has been the victim of a Ponzi scheme or other form of financial elder abuse in Los Angeles or elsewhere in California contact Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669, or by email at <a href=”mailto:email@example.com”>firstname.lastname@example.org</a>. Our toll-free number is 1-888-50EVANS (888-503-8267).
 Evans Law Firm, Inc. was not involved in the case in any way.