The Securities and Exchange Commission has charged an Internet-based investment company with securities fraud for soliciting several million dollars from U.S. investors while promising guaranteed returns of 1.2 percent per day. In reality, the company siphoned the funds into foreign bank accounts, never paying a cent back to investors. The firm allegedly raised more than $7 million from approximately 14,000 investors worldwide, more than half from U.S. members of the deaf community. The company offered the deal through its website, touting the possibility of turning a $50 investment into $134,000 in six months. On its website, the firm listed fake business addresses in both the Bahamas and Vanuatu.
Three Texas advisors have been charged in federal court with mail fraud, securities fraud, and money laundering in connection with a life-settlement scam that victimized more than 800 U.S. and Canadian investors. The advisors allegedly bought life settlements from a wholesaler and then began selling interests in those settlements back to investors. The men claimed they had set aside money to pay the premiums, but they had insufficient funds and filed for bankruptcy. Before authorities dismantled their scheme, the advisors used investor money to fund a lavish lifestyle, including buying a Lamborghini, a Porsche, a Bentley, a 5.6-carat diamond ring, a diamond Cartier watch, and a Steinway grand piano.