Investor's Watchdog.com: Stock, finance and investment protection for investors

It’s hard to know if your money is where your broker tells you it is.  And after all the scams hitting the news in the past few months, the thought is more frightening than ever.  But to the un-trained eye, how would you know what to look for on your statements? And if you’re receiving interest payments, then it’s safe to assume that everything is ok, right? 

Investors in Gen-See Capital Corp probably assumed so.  They believed that President and Owner, Richard S. Piccoli, had invested their money in “high quality” mortgages, as he said.  They also had no idea that the “return” they were receiving was actually being paid by new investor money.         

The Securities and Exchange Commission filed an emergency action against Gen-See and Piccolo, to halt this ongoing affinity fraud and Ponzi scheme. 

According to the Commission’s complaint, the defendants have raised millions of dollars from investors by promising steady, “guaranteed” returns, ranging from 7.1% to 8.3% per annum, and no fees or commissions. In November 2008 alone, the defendants raised over $500,000 from investors. The defendants have relied heavily on advertisements in newsletters published by churches and dioceses.

Michael Beebe, a news staff writer for the Buffalo News wrote a great article following Piccoli’s arrest, with a quote from his lawyer promising that Gen-See was out of business.   

According to the article, more than $16 million moved in and out of Gen- See’s account during the past two years, but only $4 million has been found so far - not very encouraging for Gen See’s 500 investors.  Even so, that is better news than that which confronts investors in other Ponzi schemes.  If the SEC learns of the scheme too late in the day, investors sometimes recover nothing.  The very nature of a Ponzi scheme is that no one complains until there is not enough money left to pay promised ‘distributions.’

Instead of assuming that your money is safe, and instead of losing sleep at night, protect yourself by investigating. Let trained eyes and experience check in on your broker and your money, and avoid misconduct that could threaten your assets.