WHO IS THE MYSTERY SCHEMER? Cheerleaders, Lawyer, PR Flak Could Not Help Accused Fraudster Defeat The Math

EDITOR’S NOTE: It’s often said that the script of Ponzi schemes does not vary much from case to case. The “story” below could be told by any number of Ponzi scheme figures. Although the words below are made up, the “story” is based on a Ponzi figure currently in the news. After you read the tale, click on the link at the bottom to see whose tale it is.

Here, now, the story of a schemer . . .

The records of my two arrests were hard to find — and I didn’t tell anybody. I was afraid that, if word got out, people might think I was a criminal and not do business with me.

I learned how to pull off my scheme by paying attention to earlier schemes I’d heard about. The banks? They didn’t have a prayer against me; I paid people commissions to bring me business and advertised a higher interest rate. People naturally reinvested their profits to earn more money. It truly was as simple as that. (And don’t let anybody tell you differently.)

People always want to believe. My clients were only too happy to help spread the good word about me. They called me a genius and got their friends and family involved. I didn’t even have to pay for the ads! The word spread like wildfire. I became the toast of the town.

It was odd, really: I hadn’t been the toast of my own household prior to getting my idea for the scheme. No one previously had associated me with money because I had none to speak of. Then — all of a sudden — everybody associated me with huge amounts of money. I had the magic touch. It happened practically overnight.

A reporter started digging around. I filed a lawsuit against him. You always can get the reporters to back off when you file a lawsuit.

Or so I thought.

Early on, I got one reporter off my trail. Hit him where it hurt. Made him spend money. I pretty much put him on the shelf.

But it turned out there was another reporter, one who didn’t care how much money I had or how many lawyers I could hire with my money. This reporter didn’t back off. He came up with a number while he was reporting: 160 million. It’s the number that contributed greatly to my demise.

Not right away, mind you. I hired a PR flak to spin my story. Beyond that, I spun my own story. I was a salesman. My job was to snow the snowman. I bobbed and weaved. I snowed. I put the investigators off for a while by pretending to be forthright and cooperative. I knew that my clients did not want to believe I was a thief. Some of them stuck with me even after the news broke.

My PR flak eventually turned on me. So did the government — federal and state. I didn’t quit, though — not even after I got caught. I got caught again in Florida. Moved offshore for a while. Got caught there, too.

For a while, I served as my own attorney. Part of me wishes I hadn’t done that — but, what the hell: I always enjoyed a good show.

Click here to learn who I am.

About the Author

19 Responses to “WHO IS THE MYSTERY SCHEMER? Cheerleaders, Lawyer, PR Flak Could Not Help Accused Fraudster Defeat The Math”

  1. Patrick:

    Great writing as always. I think many are going to be surprised as to who this person is. Actually I could think of at least 3 others it could have been that they dovetail this story almost to the letter. Since we do a PowerPoint presentation with this person referenced, it was easy for me to know who it was, but stil I checked to make sure. LOL!

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  2. A little trivia of insanity, after Ponzi was caught and jailed, investment schemes in many areas were listed as “Genuine Ponzi Investments” as a sign of legitmacy. Much as today scammers use terms like “Forex” “IPO” and such, the new term is “Arbs” or “Sports Arb” as where they supposedly put investments. Of course, of the ones that get investigated it is extremely rare for them to even attempt much in the way of real investments, and the ones that come to mind that did (Legisi sticks out) had massive losses on their feeble attempts to invest in legitmate securities.

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  3. Remembering the Yellow Kid

    The gullibility of the greedy never ceases to astound me.

    As I have stated in the pages of Reconstitution many times, the modern-day wingtards are the most expensive entitlement class this country ever produced. They don’t want to be asked to contribute a damned thing towards the wars they love (let the poor kids fight them,) or the prisons they want every dime bag dope dealer thrown in (let those prisons be financed by borrowed money and located well away from where the wingtards live,) or even to things as basically elemental as the potholes in their streets and the cops and firefighters who serve their communities. They don’t want to hear a word about paying a little extra in tax, or giving up that Denali, or (gasp!) putting a uniform on and shipping off. No, the Chimpleton wingtards want it all while giving nothing in return.

    Such people have always been among us, and they’ve always been ripe for the picking by a con artist. The latest weeping and wailing concerns Bernard Madoff, who fleeced the greedy and gullible with a rare flair. Madoff, however, is nothing new, nor is he even particularly unique; they may call what he was doing “Ponzi” schemes, but Ponzi wasn’t the first guy to do it on a grand scale either. You have to back up a few years to find the guy who qualifies as the first flim-flam master, and the truths he knew throughout his life remain just as true today.

    Joseph Weil was amazing in his ability to swindle the greedy among us. It is said that Weil was the inspiration for the movie “The Sting.” Let’s look at his story in Wikipedia. While we do this, we should also remember that this guy was in operation decades before Charles Ponzi was.

    During his career, Weil worked with, among others, con men Doc Meriwether, Frank Hogan, Billy Wall, William J. Winterbill, Bob Collins, Colonel Jim Porter, Romeo Simpson, “Fats” Levine, Jack Mason, Tim North, and George Gross.

    Weil donned gentleman’s garb and artfully flimflammed hundreds of marks, including horseplayers who fell for his phony wiretap schemes for beating the odds, lovers of exotic pets who bought his talking dogs only to learn that they had been “stricken” with laryngitis, and one detective who was finessed into buying $30,000 in “stock” from convicted swindler Weil while escorting him to prison… “Each of my victims had larceny in his heart,” explained the master of hanky-panky.

    “The desire to get something for nothing has been very costly to many people who have dealt with me and with other con men,” Weil writes. “But I have found that this is the way it works. The average person, in my estimation, is ninety-nine per cent animal and one per cent human. The ninety-nine per cent that is animal causes very little trouble. But the one per cent that is human causes all our woes. When people learn — as I doubt they will — that they can’t get something for nothing, crime will diminish and we shall live in greater harmony.”

    Weil also said that “I never swindled an honest man-only rascals. They wanted something for nothing. I gave them nothing for nothing.” If there was a way to separate the greedy from their money, the Yellow Kid knew how to get the job done. All that was required was that the sucker be one of those people who lets greed get in the way of common sense.

    Ponzi, Milken, Madoff, and their peers are the spiritual children of Joseph Weil.

    The Bush voter/”conservative” of the modern day is the spiritual child of the gullible greedy saps that Joseph Weil fleeced. Much as Joseph Weil promised fabulous riches for only a little money down, Chimpy promised his supporters that we could have it all, and someone else would pay for it. Any thinking person would surely have known that Chimpy’s economic and fiscal policies could lead us to nowhere but ruin, but the people who eagerly handed their money off to the likes of Joseph Weil would have known that only ruin was in THEIR future, if they’d bothered to study the man’s proposals at all. I submit that not only did they not even glance at what Weil was offering, you couldn’t have told them it would be any different if you’d gone to them armed with the stories of Weil’s previous marks. They believed Weil because the dollar signs were all they could see. The dollar signs were all they WANTED to see.

    Can you imagine how wealthy Weil could have become today, fleecing Chimpletons? And as an added bonus, it is very likely that nothing would have been done to stop him.

    copied from: http://reconstitution.us/rcnew/?p=3333

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  4. More claptrap from Jack. Could you be any more delusional? Poor kids fight our wars? Why don’t you do a little research before you spout your Daily Kos talking points? It would make your feeble arguments look a little more believable. That is until others actually did the research.

    Your Bush Derangement Syndrome is on overload. I suggest you seek professional help. Libtards like you are repugnant. Blinded by your hatred of ‘Bush’. Hint: Bush is no longer in office and has no influence on your boy Obama. Obama’s doing such a great job, isn’t he?

    Madoff was a DEMOCRAT and a huge supporter of Democrats. hahahahaha
    He also ‘fleeced’ some pretty intelligent and influential people. His was more of a confidence game. He had a name that people trusted due to the people he associated with and ‘invested’ on behalf of. Of course your hatred of ‘The Right Wing’ blinds you to what is painfully obvious to the rest of us.

    Try again, and this time put your BDS on hold. If you can.

    Oh yeah, one more thing Jack. Funny that you mention Ponzi and Madoff. Madoff is a big supporter of the Democratic Party and a lobbyist, but how could he not be? How could the Charles Ponzi of today thrive in any party other than the party that memorialized the Ponzi Scheme forever, with Social Security?

    Have fun.

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  5. http://www.usatoday.com/news/opinion/editorials/2005-11-27-soldier-edit_x.htm

    Amazing. This comes from a left leaning democrat supporting publication. I have dozens of other articles that say the same thing.

    There you go Jack. If you are too lazy to do a little research I’ll do it for you. Hows that feel? I’ll expect a full retraction and apology to the upper middle class members of my family that have served in every war since Korea.

    Thanks so much.

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  6. Ignoring the last writer who must surely be related to Bob G (but with grammar), your article really does demonstrate that nothing changes.

    Ponzi’s description could be that of any one of the current ponzi players, with a few variations to allow for the change in communication techniques and the incursion of the internet into the world of white collar crime.

    Western society seems to have lost all the values that it was built on in favour of the Big Buck. This replacement of values and integrity in favour of the achievement of the Big Buck is now used by many to justify the means to the end – money, irrespective of its source.

    It is so easy to forget, in the plethora of contrasting arguements for the fraudulent ponzi scheme, that,once you take out the complexity of calculation, they boil down to nothing more than simple theft. Ponzis involve money stolen from partipants by owners and other participants, whether or not they steal knowingly. If people know it is wrong to steal directly from someone else’s purse, why do they have such trouble in understanding that paying an old member with a new members money is no different.

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  7. alasycia,

    I see you want to ignore me, but not the moron Arons who links to a site that hopes for the actual DEATHS of those he disagrees with. Don’t believe me? Why don’t you try reading before you spout off on things you know nothing about.

    As for your comments, cry me a river! It’s the fault of the free market?
    How tiresome.

    You seem to think that these HYIPs are taking over the world of finance. Wrong. They are small time scams, and you give them way to much credit. Madoff did not run an HYIP. Are you aware of that? He had an office, phone lines, etc. He paid out around 10-13% a year, not 20% a month. Even paying 10% year after year put him on the radar of many.

    You are a former ASD player if memory serves. What did you really think you were doing? Be honest. Only an idiot would think there was anything legal about that flagrant Ponzi.

    You want to call me names? look in your own back yard before throwing out accusations. Me related to Bob G? You can do better than that, I’m sure.

    Ridiculous generalities do you no favors. Saying Western society seems to have lost ALL its values in favor of the big buck is asinine.

    I could say something just as ludicrous about you, but I won’t.

    p.s. I do not support Ponzi schemes or the people who play them.
    I thought I’d clear that up before you accuse me of some other nonsensical ‘fact’.

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  8. A ponzi scammer used religion extensively in his scam. In fact he claimed that God gave him special powers to attract money.

    Bowdoin said he was a money magnet. Gerald Payne (Greater Ministries International) claimed “God had modernized the multiplication of the loaves and fishes and asked him to share the secret.”

    Two Baptist Foundation of Arizona executives were accused of fraudulently conducting a mammoth real estate Ponzi scheme while claiming to do God’s work. William P. Crotts, the former president of the foundation and Thomas D. Grabinski, the former chief counsel of the foundation, were sentenced to eight and six years in prison, respectively.

    Religion being used in ponzi schemes is not new.

    Often the ponzi shrills claim that the ponzi operator is just helping the little guy to make money just like the super-rich. In 1992, Damara Bertges and Hans Gunther Spachtholz founded the European Kings Club, a “non-profit” association that rallied against big European banks and promised to help the “little guys.”

    Bowdoin, CEP and Marsden all tried to either buy a bank, own a bank, or a payment processor of some sort. Maria Branca dos Santos, or more commonly called “Dona” Branca, was a poor Portuguese woman when she decided that she would open her own “bank” in 1970. To make it attractive, she promised an interest rate of 10% per month, and got thousands of clients (including the working poor of Portugal) to give her their money.

    Another excuse that is often used is that the ponzi scheme has been operating for X months/years so it must be real. GNI claims its been going since 2006, SwissCash claimed it had been in business since 1945! Madoff’s scheme was going for 20 years or more. The length of time does not stop it being a ponzi.

    Bowdoin promised 125% return, others have offered more. After two years as a fugitive Won Sok Lee, Partner at the Florida-based KL Group fund, has been sentenced to 25 years in prison for a Ponzi scheme that defrauded investors of $194 million. The firm ran a number of funds from offices in Florida and Nevada that misled investors to believe the firm had invented a proprietary trading system capable of achieving 100% annualized returns.

    [some of my post above is straight C&P from various web sites]

    Ross: You seem to think that these HYIPs are taking over the world of finance. Wrong.

    One of the web sites I C&P info from is here:
    http://www.hedgetracker.com/fraud_news.php
    It has, amongst other things, a list of some recent ponzi schemes. I haven’t gone through the list to total the amount lost to fraud but I suspect it’s quite large.

    Ross: They are small time scams, and you give them way to much credit.

    Is there a certain size of ponzi scheme that you would regard as insignificant?

    Ross: Madoff did not run an HYIP. Are you aware of that? He had an office, phone lines, etc.

    Bowdoin had an office, phone lines, etc. So did AVGA. Often even the “small time scams” will claim to be a registered company with a “real” mailing address in order to give the illusion of legitimacy. It’s another trick that has been used many times – 12DailyPro, ASD, CEP, GNI, many others.

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  9. You are comparing Andy to Madoff? Please. Also, Bowdoin ran an auto-surf scam not a typical HYIP program. Granted, it was a Ponzi but not what I was talking about with alasycia.

    I am aware of hedgetracker and am registered there. You can plainly see that the Madoff scam is not even close to the others. You can add up all of the numbers on the list (the whole list not just what’s on the main page) and they do not match the total fraud of Madoff.

    And your point was?

    Yes GNI was registered in Belize. So what? I could register my dog there.

    Can we stop with these games, and get down to my assertion that HYIPs are not taking over the world of finance?

    They are not.

    Not even close. They are a pimple on the butt of the money supply. Nothing more. If the fools and criminals stopped ‘investing’ they would disappear completely.

    Therein lies the real problem. Education and enforcement.

    Have a good one.

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  10. Another common trait with these ponzi schemes is that they seem to attract similar personality types. One type of personality are the conspiracy theorists. Another type are the “aggressive” posters, those who do their best to engineer arguments. Sometimes they are attention seekers. Little Bobby was one such, and so it seems is “Ross”. It could be why they sound so similar.

    Ross: Can we stop with these games, and get down to my assertion that HYIPs are not taking over the world of finance?

    This is the attention seeking bit. Something that Little Idiot Bobby did a lot of. The discussion on HYIPs & the damage they cause was a poll in a different story, not this one. This is about the common traits between scams.

    Ross: Yes GNI was registered in Belize. So what? I could register my dog there.

    Little Bobby did this a lot as well – the assertion of “expert” knowledge. Actually Little Bobby did it with much better gusto. In a way, “Professor” Moriarty did it as well, by setting up his Association thingy so he could fight the legal system.

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  11. Uh, what was the question again?

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  12. Given that financial fraud is a multi billion dollar industry, and that it includes all the on and offline frauds, it seems to me to be irrelevant whether one is small and another is large. Some people and institutions who lost money with Maddoff lost fortunes, some people who lost money with CEP, ASD and all the other smaller scale frauds lost retirement funds of thousands of dollars, or money set aside for their health treatment or children’s educations. The pain and suffering caused to the individuals does not depend on the amount of money lost, but on its relative importance in the lives of the victims.

    It is equally important to remember that the sum total of these schemes, together with the vast sums handled by the various enablers, including offshore payment processors and banks, cannot be underestimated or ignored and that little or none of it seems to be counted within the Gross National Product of the countries concerned.

    It must be a considerable factor in the economy for the US government to have invested the money they have done in setting up of their new anti fraud organisation.

    Money laundering is not a healthy economic pastime for any country and is considered to be on the increase not the decrease in these difficult economic times.

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  13. Ross or rather Little Man with Big Mouth.

    For your information the link was only to the article about my Uncle and not the site itself.

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  14. Actually what is worse than the scam itself, is when people claim they have a solution to get the money back for the people scammed. They give them false hope they can do things, collect money for their services, and they don’t deliver. Thus the victim is scammed twice.

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  15. One of the problems associated with the views of posters such as “Ross’ and others of his ilk, is that the myopic nature of their viewpoint/s is so obviously flawed as to be almost laughable.

    On this forum alone, there are links to:

    a) A criminal prosecution involving an admitted direct connection between fraud and terrorist funding.

    b) A news article wherein a government appointed crime commission estimates an $6 BILLION annual cost of fraud to the Australian economy , much of the fraud being internet based. This,by the way, in a country with population numbers around 10% of the USA) The article makes no mention of a distinction between “legitimate” fraud and “the victim shoulda known better” fraud.

    c) multiple instances of criminals being charged with “fraud” and/or “money laundering” and/or “conspiracy” whether or not apologists consider them “HYIP” or “AUTOSURF” or “GAMBLING GAMES” And whether or not the fraudsters are operating 30 X $1000 scams or 1 X $300,000 operation.

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  16. Hi LRM,

    littleroundman: A news article wherein a government appointed crime commission estimates an $6 BILLION annual cost of fraud to the Australian economy , much of the fraud being internet based. This,by the way, in a country with population numbers around 10% of the USA) The article makes no mention of a distinction between “legitimate” fraud and “the victim shoulda known better” fraud.

    That article was an eye-opener. Thanks for sharing the link. Jamaica, too, is engaging in a campaign to educate the public about fraud.

    The world banking environment has not been this tenuous since the Great Depression. Untold billions of dollars in polluted money is circling the globe, making it harder for legitimate companies to get the capital they need to expand and create jobs.

    Naturally, the Ponzi enthusiasts say the problem can be solved by creating more Ponzis to pollute more banks — under some bizarre theory that a rising Ponzi tide lifts all boats.

    Back in February 2009, AVG said it had the cure for the ailing economy: more and better autosurfing. The troops seem to have under-delivered.

    Patrick

    Patrick

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  17. There you go Jack. If you are too lazy to do a little research I’ll do it for you. Hows that feel? I’ll expect a full retraction and apology to the upper middle class members of my family that have served in every war since Korea.

    Thanks so much.

    You’ll get nothing of the sort. You might try to wiggle around the rules with your exceptions, but the simple fact of the matter is that without a draft, wars will be fought overwhelmingly by people of unfortunate circumstances.

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  18. Jolly Roger: There you go Jack. If you are too lazy to do a little research I’ll do it for you. Hows that feel? I’ll expect a full retraction and apology to the upper middle class members of my family that have served in every war since Korea.Thanks so much. You’ll get nothing of the sort. You might try to wiggle around the rules with your exceptions, but the simple fact of the matter is that without a draft, wars will be fought overwhelmingly by people of unfortunate circumstances.  (Quote)

    Not true. It is a myth that people like you try to continue to spread. An independent study was done on people enlisting in the military (all branches), and they found that over 75% came from mid to upper middle class families and income average of $48,000. This notion that only the poor or indigent fills the military ranks is simply not true. They also found the level of education was extremely higher than in years past due to the techinical applications that is required in all branches of the military now. If you Google you will find this report.

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  19. Hmmm….

    Lynn, dare I say it, but you are stepping on highly debatable political ground here. There is a debate with many sources which can be found on Google and, whilst some of them support your views, there are many other sources that disagree.

    For the sake of the purpose of Patrick’s blog – to report and inform on ponzi schemes and their consequences – and because it is OFF TOPIC, it may be prudent not to continue this line of discussion, or we will ALL fall out. lol

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