Archive for July, 2009

Ponzi Victims Asked to Repay Money

Tuesday, July 21st, 2009

After Derrich Pollock died in a small plane crash in Texas in 2007, the Texas State Securities Division found that he was running a Ponzi scheme that owed millions to investors.  Claire Osborn wrote a great article for Austin American-Statesman, detailing the scam, the accident, and how the victims of the scheme have been compensated.  Pollock was survived by his wife, Julee Pollock and their four children. (more…)

White House Investor Protection Proposals - A Good Start

Monday, July 20th, 2009

The White House is proposing to increase the powers of the Securities and Exchange Commission (SEC).  If enacted, the proposals will do some good.  Most important is the proposal that stockbrokers be held to a fiduciary standard, putting their client’s interests before their own.  It may surprise you to learn that stockbrokers have not always had that duty.  Certainly the securities industry has been shy about telling you the truth. (more…)

Organized Crime and the Future of Securities Fraud

Friday, July 17th, 2009

In 2003, the FBI issued a report that reads in part as follows:

The end of the cold war provided significant, unintended opportunities for organized crime groups and criminal enterprises in former communist countries to expand internationally to western Europe and beyond. Evidence that organized crime activity from these areas is expanding and will continue to expand to the United States is well-documented. Criminal groups from the Balkans, eastern and central Europe and the former Soviet Union are involved in all types of criminal activity in the United States, from drug trafficking and human trafficking to burglary and home invasion robbery rings, from money laundering and securities fraud to traditional organized crime gambling and extortion rackets.  


Indiana Charges Four With Criminal Affinity Fraud

Thursday, July 16th, 2009

The State of Indiana has charged four men engaged in selling church bonds with criminal securities law violations.  The men are Vaughn A. Reeves, Sr.; Vaughn A. Reeves, Jr.; Jonathan Christopher Reeves; and Joshua Craig Reeves (collectively, the Reeves).  Specifically, the Indiana alleges that:


SEC Accuses Russian Company of Hijacking Customers’ Online Brokerage Accounts

Wednesday, July 15th, 2009

The United States Securities and Exchange Commission has charged a Russian company, Pointer Worldwide Ltd and its officer, Tatiana Badmaeva, with hijacking the accounts of online brokerage customers and using the innocent customers’ accounts to buy and sell stocks in furtherance of a pump and dump scheme.


Prime Bank Fraud Happening Right Now

Tuesday, July 14th, 2009

Investor’s Watchdog’s Chartered Financial Analyst brought me Section B of the Atlanta Journal Constitution this week and pointed me to an ad under the heading “Investments.”  It reads as follows:

Investment - It’s NOT magic - but Retired Bank President can roll $250K into $1 MM CASH within 30 days GUARANTEED.  Participation is LIMITED.


SEC Charges Alleged Boiler-room Operation

Tuesday, July 14th, 2009

The Securities and Exchange Commission has charged Sky Capital LLC a/k/a Granta Capital LLC with using fraudulent boiler room tactics to raise more than $61 million from investors in two related companies — Sky Capital Holdings Ltd. and Sky Capital Enterprises, Inc. (the Sky Entities). The Commission also charged Sky Capital’s founder, former President and CEO, Ross Mandell, the firm’s former COO, Stephen Shea, and four registered representatives, Adam Harrington Ruckdeschel, Arn Wilson, Michael Passaro, and Robert Grabowski, for orchestrating and participating in the fraudulent scheme designed to fraudulently induce numerous individuals to invest in the Sky Entities.


3 Men Accused of Running a $485 Million Oil and Gas Ponzi Scheme

Monday, July 13th, 2009

The downfall of the U.S. economy has led to an increase in securities scams.  Texas-based oil and gas scams always flourish in such times.  Scamsters have a tendency to go after what they know, and in Texas, they know oil.  The Securities and Exchange Commission (SEC) filed civil fraud charges against 3 Texas men, Paul R. Melbye, Brendan Coughlin, and Henry Harrison, for allegedly orchestrating a $485 million Ponzi scheme through their company, Provident Royalties LLC. (more…)

Four Sentenced in Connection with Worldwide Prime Bank Scam

Friday, July 10th, 2009


Britain’s Serious Fraud Office (SFO) is reporting on the sentencing of four men who ran an international prime bank scam from Cheshire, England.  Two of the defendants, Frederick Taylor and Martin Shaughnessy, were former Cheshire police officers.  Through their companies, Maincrest Investments Ltd and London & General Finance Ltd, they raised more than $10 million by offering returns of 80% to 100%.  The other defendants were Paul De Rome and Ian Whitlock.


Coming Soon - More “Green Energy” Scams

Thursday, July 9th, 2009

The G8 group of industrialized nations agreed today on a maximum rise in global temperatures, 2 degrees Celsius, above 1900 levels.  According to experts, any rise above that temperature would make the environment dangerously unstable.  While this is a helpful and necessary agreement, the news of the agreement will set in motion hundreds of investment scams pitching supposedly revolutionary solutions to the problem.  An Inconvenient Truth and Al Gore’s receipt of the Nobel Prize had a similar effect. (more…)