Patrick H. Rakotonanahary Sentenced To Prison For Forex Scheme That Defrauded Investors In Hawaii And On The U.S. Mainland; Case Was One Of The First Brought By Financial Fraud Enforcement Task Force

A Florida resident charged with defrauding investors in Hawaii and the U.S. mainland has been sentenced to 90 months in federal prison, ordered to begin serving his sentence immediately and make restitution — and advised he faces deportation to Madagascar upon his release from a U.S. prison.

The case against Patrick H. Rakotonanahary, 34, of Punta Gorda, was one of the first assembled by President Obama’s Financial Fraud Enforcement Task Force. He was sued civilly by the CFTC and charged criminally by the FBI in March 2010 with 21 counts of wire fraud, amid allegations he operated a forex Ponzi scheme and pocketed $1 million for himself.

The scheme affected about 100 investors, most of them residents of Hawaii, state and federal investigators said.  The state of Hawaii also sued Rakotonanahary.

Rakotonanahary operated a company known as Cyber Market Group LLC, which marketed a Forex scheme that purported to pay investors up to 10 percent interest per week. The scheme netted more than $10.2 million.

Only minimal Forex trading occurred — and the trading that did occur resulted in losses, authorities said. The scheme sustained itself in typical Ponzi fashion.

See earlier story.

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3 Responses to “Patrick H. Rakotonanahary Sentenced To Prison For Forex Scheme That Defrauded Investors In Hawaii And On The U.S. Mainland; Case Was One Of The First Brought By Financial Fraud Enforcement Task Force”

  1. http://www.staradvertiser.com/news/hawaiinews/20110125_Ponzi_scheme_lands_Florida_man_in_prison.html

    Rakotonanahary paid the bulk of the money to earlier investors, lost about $800,000 in the market exchange but spent about $1 million on himself and friends, Tong said.

    While victims lost life savings, retirement accounts and money for college education, Rakotonanahary and friends incurred expenses that included $60,000 at an upscale Washington, D.C., hotel, $120,000 for three vehicles and $8,000 for concert tickets, Tong said.

    Rakotonanahary told Seabright he had really intended to make money for people and his lawyer, Rustam Barbee, said his client did not have a lavish lifestyle.

    But Seabright characterized Rakotonanahary as a “con artist” who lied about having experience or skills in the foreign exchange market and about having enough funds to pay the victims.

    “This wasn’t about altruism,” the judge said. “It was about greed.”

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  2. It always is..about greed that is.

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  3. Rakotonanahary told Seabright he had really intended to make money for people and his lawyer, Rustam Barbee, said his client did not have a lavish lifestyle.

    IM(very)HO a very clear distinction needs to be made between what a fraudsters’ defense team offers in mitigation of the clients’ activities and what the facts of the matter reveal.

    It seems one of the consequences of modern era of “soundbite” journalism is that many/most casual observers inadvertently accept the defense lawyers’ pleadings as being “fact” and fail to quite realize the gravity of the situation.

    These people are lying, cheating, low life criminals without an ounce of morality.

    Prince or Pauper, it makes not one skerrick of difference to these fraudsters, who remain, IM(very)HO beneath contempt and deserving of every second spent deprived of their liberty.

    These are no spur of the moment crimes of passion.

    These are well thought out and carefully considered schemes.

    No citizen is exempt from their consequences.

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