When Investor’s Watchdog began blogging, the name Norman Hsu was on the lips of every conservative talk radio host.  A substantial contributor to the campaign of Senator Hillary Clinton, Hsu was a very successful scam artist.  After skipping a court appearance and attempting suicide on a cross country train trip, Hsu was arrested at the hospital after having his stomach pumped.   (more…)

According to the Wall Street Journal, Lehman Brothers may have been defrauded in a $250 million swindle worthy of The Sting or The Spanish Prisoner.  At the center of the swindle are loans that Lehman made to a fund run by a medical consulting company owned by LTT Bio-Pharma Co.-a Japanese bio-tech company.  As security for those loans, Lehman believed that it received certificates from Marubeni Corp., one of Japan’s biggest trading companies.  Marubeni says otherwise.   (more…)

Times were good for quite awhile.  Every month when you opened your brokerage account statement, you looked at the figure at the bottom and saw that it was more than it had been the previous month.  If you are like most investors, you did little else to evaluate whether your broker had served your interests that month.  (more…)

“How the mighty have fallen.”  2 Samuel 1:19.

Lou Pearlman-the mastermind behind ‘N Sync and the Backstreet Boys-now sits in an Orlando jail, having detailed his 20-year life as a Ponzi scheme operator in a signed plea agreement.  The details of how Pearlman’s Ponzi scheme raised $300 million provide a peek into how the most successful Ponzi operators maintain the aura of legitimacy so necessary to their work.  (more…)

The FBI has raided the office of a California company called Christians in Crisis Investment Fund.  Stephen K. Wilson and his wife, Christina Silvas are under investigation for money laundering and running  a Ponzi scheme through that business.    

Silvas had her first fifteen minutes of fame in 2002  when a Christian school that her daughter attended told Silvas to quit her job as a stripper or her child would be expelled from the school.  The flap landed in the national media and got Silvas a photo shoot with Playboy magazine. (more…)

No one wants anything more than the thing they can’t have.  The scam artist knows the human mind; knows that scarcity makes things more valuable.  Diamonds are expensive because there are relatively few of them.  The Mona Lisa is priceless because there is only one of her. (more…)

Among the trappings of wealth that Wesley Snyder accumulated in the three years he ran a Ponzi scheme under the name Personal Financial Management Inc., are a house in Oley, Pennsylvania, two office buildings, a North Carolina time-share condominium, bank accounts, two cars, and 12 life insurance policies.  The two office buildings are valued at $525,000.  The home in Oley is valued at $200,000.  The life insurance policies have a face amount of $12 million, but a net cash surrender value of only $111,000.  Unfortunately the value of all of the assets after mortgages and other indebtedness is paid is only about $165,000. 

Don Spatz of the Reading Eagle reports: (more…)

Former San Francisco 49ers Coach Steve Mariucci knew Frank Garza, Jr, who owned a tax service on Powell Street in San Francisco.  When Garza told Mariucci and others that he could get them in on a “rare investment opportunity” in Aerie Networks, a Colorado fiber-optics company, Mariucci invested $1 million, and other investors added another $2.8 million.  Unbeknownst to any of the investors, Garza diverted $1 million of those investments to his personal use, buying a penthouse apartment and building a home in Arizona.    (more…)

Today, police led Val E. Southwick out of his office in handcuffs bringing to a close what prosecutors are calling perhaps the biggest scam in Utah history.  For the 800 people who invested through Southwick, though, today was only the beginning of a long journey during which they will learn how much, if any, of their nest eggs have survived the scam. (more…)

In 1992, there was excitement in Lakeland, Florida.  A local businessman, Karl Rehberg had found a way to produce biodiesel fuel from used restaurant cooking grease.  That excitement made it relatively easy for Rehberg and his wife, Helen, to sell stock in their company, NOPEC, to 2500 people not just in Polk County, but in other states as well.  Between 1992 and 1997, they raised $20.6 million through those sales. (more…)