BREAKING NEWS: Bank Of America Named In New Lawsuit Amid Allegations It Aided And Abetted Alleged ‘Beau Diamond’ Ponzi Scheme In Florida; Lawyer Who Sued ASD President Andy Bowdoin For Racketeering Is Co-Counsel For Plaintiffs

UPDATED 2:07 P.M. EDT (U.S.A.) Courthouse News Service is reporting that Bank of America has been named a defendant in a federal lawsuit filed in Florida that alleges it aided and abetted the Beau Diamond Ponzi scheme that fleeced investors out of millions of dollars.

Bank of America also is named a defendant in a lawsuit against Florida-based AdSurfDaily Inc., which is implicated in an alleged $100 million Ponzi scheme. The lawsuit in the ASD case was filed as a racketeering complaint.

The bank, which has denied wrongdoing, is not named a RICO defendant in the ASD case. Rather, it is accused of aiding and abetting a fraudulent scheme involving unnamed co-conspirators. The ASD case is on hold, pending the outcome of federal litigation against the autosurf firm.

Attorneys for plaintiffs in the alleged Beau Diamond Ponzi scheme say the bank had “actual knowledge” of the scheme and “shares the responsibility for losses of $37 million,” according to the complaint.

One of the attorneys in the Beau Diamond case is Steven Berk of Washington, DC. Berk also is a plaintiffs’ attorney in the ASD case. The other plaintiffs’ attorneys in the Beau Diamond case are Andre R. Perron and Randolph L. Smith of Brandenton, Fla.

Beau Diamond operated Diamond Ventures LLC of Sarasota. He was arrested by the Pinellas County Sheriff’s Office in September after a probe by the FBI and Internal Revenue Service led to federal charges of wire fraud and money-laundering.

The case is being prosecuted by the office of U.S. Attorney A. Brian Albritton of the Middle District of Florida. Albritton also is leading a major federal operation designed to prosecute cases of mortgage fraud. Nine banks have failed in Florida this year.

Separately, Diamond was sued by the U.S. Commodity Futures Trading Commission (CFTC) in a complaint that alleged widespread fraud.

Diamond’s actions cost investors at least $13.3 million, CFTC said.

Diamond spent customers’ money on lavish personal expenses, including at least $850,000 for “luxury purchases and gambling,” CFTC said.

Some of the allegations against Diamond read like discussions commonly seen on Internet forums when a scheme goes belly-up and the excuse-making by sponsors begins. Among the assertions by CFTC was that Diamond urged members not to call authorities because involving the government only would make matters worse.

The Diamond Ventures HYIP enterprise quit paying in December 2008, telling some members they had not received checks because it took longer for the U.S. Postal Service to deliver mail near the holidays, CFTC said.

Other members were told Diamond had a problem with Bank of America and was transferring his accounts to JP Morgan Chase, CFTC said.

By Jan. 7, Diamond was explaining to customers that a “serious situation” had emerged. On Jan 9, he told customers that “the funds have been lost” due to a downturn in the world economy and unprecedented volatility, CFTC said.

What Diamond did not tell customers was that he had lost huge sums in forex trades, had sent customers bogus account statements showing they were money to the good — and blew as much as $1.1 million on gambling, air travel, jewelry and hotel accommodations, CFTC said.

By Jan 22, CFTC said, Diamond was urging customers not to “initiate a federal investigation” because such an event would lead to a situation in which “no one will see a penny, and I most likely will be behind bars,” CFTC said.

Read the CFTC complaint against Beau Diamond.

Read the FBI criminal complaint against Diamond.

Read today’s coverage of Diamond at Courthouse News Service. (There is a link to the lawsuit against Bank of America at the bottom of the story.)

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8 Responses to “BREAKING NEWS: Bank Of America Named In New Lawsuit Amid Allegations It Aided And Abetted Alleged ‘Beau Diamond’ Ponzi Scheme In Florida; Lawyer Who Sued ASD President Andy Bowdoin For Racketeering Is Co-Counsel For Plaintiffs”

  1. Kinda looks like there’s a pattern of “turning a blind eye” at the BofA. I wonder how many more cases will have their name mentioned?

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  2. I wonder if BOA employee’s worked part time at Beau Diamond?
    I still have e-mails from January of 08 that bragged about how hard it was for a business to get a BOA account. Thinking about it, ASD never had a business checking acount!! lol
    unbeleivable!! you could maybe understand that Sarasota is so much bigger that Quincy, but BOA should have closed ASD right after the rallies started in March of 08 period.

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  3. Patrick, you seem to have missed the state of Illinois securities filing:
    http://docs.google.com/gview?a=v&q=cache:eH7NhbXBHrcJ:www.cyberdriveillinois.com/departments/securities/administrative_actions/2008/july/legacycapital_top.pdf+Dianne+Sharon+Rosiek&hl=en&gl=uk&sig=AFQjCNEulg7eIBAdc_iUEa6NvF-jaglbsA

    Also, from
    http://www.bcsc.bc.ca/comdoc.nsf/comdoc.nsf/webpolicies/8659EB2C48650ECD88257302005BA5B8?OpenDocument

    Dianne Sharon Rosiek (Rosiek) resides in Surrey, British Columbia. She is responsible for the administration of Legacy, which includes giving presentations to investors, soliciting investors, receiving investors’ funds and creating spiritual trusts for investors. On December 5, 1995, Rosiek was convicted in the United States of conspiring to traffic in narcotics. On December 5, 1996, she was deported to Canada under a prisoner exchange agreement.

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  4. LOL. I had a BofA business bank account when I had my business. I just needed the usual and….a copy of my business license. That might be a hurdle in the Ponzi world but not for a real business.

    mark kreiling: I still have e-mails from January of 08 that bragged about how hard it was for a business to get a BOA account

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  5. Tony,

    Thanks for those links. Readers will appreciate them.

    Regards,

    Patrick

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  6. Thanks for tiding up my posts, Patrick. So many ponzis being reported lately it’s difficult to remember which is which at times.

    Reading the FBI complaint, the scam sounds like most of the ponzi-HYIPS as promoted on moneymakergroup and/or talkgold. There’s a short thread at talkgold:
    http://www.talkgold.com/forum/showthread.php?t=6421&page=1

    Here’s an interesting story:
    Beau Diamond’s father will guide his defense
    http://www.allbusiness.com/legal/trial-procedure-jurisdiction/13012997-1.html

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  7. Thanks, Tony for the links!! Sorry to read about Harvey Diamond. Diamond impacted my life after reading his his book (back in the 80’s), Fit for Life. I removed red meat and cow’s milk from my diet after reading that book. Too bad he is involved in this scam..if only by condoning his son’s actions.

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