Advice from Someone Who Knows

Taking the proper mental approach to an investigation will not come to you naturally.

Kent Burleson of Maryville, Tennessee, was a lineman and a splicer for AT&T. For thirty years he built up a nest egg sufficient to provide him with a comfortable retirement. When he retired, he entrusted that nest egg to Benchmark Capital, Inc. Reporter J.J. Kindred of The Daily Times has written a compelling account of what happened next. The entire story is well worth your time. For our purposes, we’ve copied excerpts below: (more…)

And They’ll Start Another One Tomorrow

They have the thing that our parents told us did not exist — a money tree.

In The Vigilant Investor, I describe five different types of financial scamster, from the career criminal all the way down to the inept “bungler.” In truth, there are infinite ways to slice and dice the characters who deprive investors-institutional investors included-of their assets. The descriptions I give in the book are only one way to identify them. Using those descriptions, though, the people whom the SEC named in an enforcement action out of Illinois last week would, if they are guilty, belong in the “career criminal” category. According to the SEC’s press release: (more…)

Two Years on the Lam with a Wife and Ten Children

It’s a small world and getting smaller every day, but it’s still big enough to hide in, even with a wife and ten kids.

Jeffery L. Cassman was a financial adviser in Franklin, Tennessee, an affluent suburb south of Nashville. Between 2003 and 2005, he solicited approximately $1 million from clients, including family, and friends from church, for investments in what he described as tax liens. He told his clients that the investments were foolproof.  But there were no investments. Cassman spent the money on personal expenses. When he was indicted on mail fraud charges, he promised to turn himself in, but instead fled with his pregnant wife and nine children. The Tennessee Bureau of Investigation quickly put him on its Most Wanted list and the search began. Family back home received packages from Mr. and Mrs. Cassman with pictures of the children. They all looked healthy, but their hair had been dyed. Folks had different theories about where the Cassman’s had fled to.  Some thought Argentina. Their packages were always postmarked from Tuscon, Arizona. (more…)

Tennessee Authorities Arrest County Commissioner Following Ponzi Charges

People who have access to your money are so placed that their mistakes can cost you a lifetime of savings.

The Tennessean is reporting that former Robertson County Commissioner Shannon Polen has been arrested and charged with theft. This follows the filing of a lawsuit by people who invested in business deals that Polen promised would be very profitable. According to the plaintiffs, Polen robbed Peter to pay Paul in classic Ponzi fashion. According to the story from The Tennessean: (more…)

CFTC Halts Alleged $50 Million Ponzi

With the first baby boomers turning 65 this year and many looking to recoup investment losses from the stock market swoon of 2008, many will be lured into foreign currency and gold scams that tout a successful track record and promise steady returns.

The SEC is not the only regulator on the hunt for investment fraud.  Every year, the U.S. Commodities Futures Trading Commission files emergency enforcement actions to shut down alleged ongoing scams.  The CFTC filed such a case last week. According to the CFTC, Robert J. Andres and Winsome Investment Trust (Winsome), both of Houston, Texas, Robert L. Holloway of San Diego, California, and US Ventures LC (USV) of Salt Lake City, Utah engaged in a scam that robbed 243 investors of more than $50 million.  According to Hedgeweek.com: (more…)

Alleged Ponzi Scamster on the Run

The investment criminal thinks that he or she is going to get away with it. Jail never enters into their thinking, except as it relates to the date on which they will need to flee with their ill-gotten loot.

According to federal prosecutors, Salih Acarbulut, a Turkish national who formerly resided in Chattanooga, Tennessee, is on the run.  A federal grand jury in Chattanooga indicted Acarbulut on 10 counts of wire fraud and money laundering this week, arising from an alleged Ponzi scheme that robbed more than $12 million from 100 investors.  According to WDEF News in Chattanooga: (more…)

CPA Involved in Ponzi Loses License

This case reminds us that Ponzi scamsters often work through accountants and insurance agents because those people often have a long list of clients who have trusted them for years.

You have to figure that Murfreesboro, Tennesssee, CPA Mark S. Riddle knew that this day was coming.  The Tennessee Department of Commerce has revoked his accountancy license.  According to a story in The Daily News Journal: (more…)

Pastors, Listen to Me!

The wolves are out there, and their sheep suits are custom-made.

We blog on a new investment scam every weekday.  Most days we have several to choose from.  That’s how bad the epidemic of investment fraud is.  None of the scams is more tragic than those involving scamsters who worm their way into communities of faith.  Pastors, as guardians of their flock, need to step up and be more proactive at identifying and stopping these characters. (more…)

Another Post-Madoff Scam?

The financial crisis of 2008 flushed out many scams, including Bernard Madoff’s record-setter, as investors demanded redemptions that scam artists could not produce. We have been tracking the building of the post-Madoff wave of scams. The U.S. Securities and Exchange Commission (“SEC”) believes that it has found another scam in that wave.

The financial crisis of 2008 flushed out many scams, including Bernard Madoff’s record-setter, as investors demanded redemptions that scam artists could not produce.  We have been tracking the building of the post-Madoff wave of scams.  The U.S. Securities and Exchange Commission (“SEC”) believes that it has found another scam in that wave.  The SEC has charged Aaron Donald Vallett, a registered representative in Brentwood, Tennessee operating through A.D. Vallett & Co., LLC, with fraud in connection with several unregistered investment pools. (more…)

SEC Charges Cleveland-Area Investment Adviser With Fraud

Twelve years is a long time to run a Ponzi scheme. Bernard Madoff aside, most collapse within five years. Yet, the U.S. Securities and Exchange Commission (“SEC”) claims that Enrique F. Villalba, Jr, of Cuyahoga Falls, Ohio began raising money from his alleged victims in 1998. A look at the specific allegations shows why Villalba, if the allegation are true, was able to keep a scam running for that long.

Twelve years is a long time to run a Ponzi scheme.  Bernard Madoff aside, most collapse within five years.  Yet, the U.S. Securities and Exchange Commission (“SEC”) claims that Enrique F. Villalba, Jr, of Cuyahoga Falls, Ohio began raising money from his alleged victims in 1998.  A look at the specific allegations shows why Villalba, if the allegations are true, was able to keep a scam running for that long. (more…)

The Accuracy of the Crystal Ball

James Terry Brinley of Millington, Tennessee pleaded guilty this week “to carrying out a Ponzi scheme that defrauded investors of about $3.5 million.”

Part of Investor’s Watchdog’s work involves looking into the future of investment scams. What pitches will be popular? What types of instruments will scam artists be selling. When we launched our website in 2008, we included a section entitled Crystal Ball where we give answers to those questions. A recent case out of Tennessee proves the accuracy of the IW crystal ball. (more…)

Alleged Operator of Tennessee-based Ponzi Expected to Plead Guilty

Dennis Bolze told prospective investors that he was a successful stock trader.  More than 100 people believed him.  Operating from offices in Gatlinburg, Tennessee, he ultimately raised approximately $20 million, more than enough to build a 16,000 square foot mansion and treat himself to finest of what money can buy.  According to federal authorities Bolze used money [...]

Dennis Bolze told prospective investors that he was a successful stock trader.  More than 100 people believed him.  Operating from offices in Gatlinburg, Tennessee, he ultimately raised approximately $20 million, more than enough to build a 16,000 square foot mansion and treat himself to finest of what money can buy.  According to federal authorities Bolze used money collected from later investors to pay supposed profit distributions to earlier investors in classic Ponzi fashion.  When the cops went to pick him up, he had fled to State College, Pennsylvania, where they ultimately found him. (more…)

 
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