3 PTA Moms Charged In Alleged California Ponzi Swindle; Suspects Claimed They Had Exclusive Deal To Sell Dairy Products At Disneyland, L.A. County Sheriff’s Department Says

EDITOR’S NOTE: This is one of those stories of an investor wipeout that may leave you scratching your head and wondering if no person, institution or symbol of America is off-limits in the world of Ponzi criminals.

For starters,  the scheme allegedly was targeted at least in part at Parent-Teacher Association (PTA) members in the Los Angeles area. If that’s not bad enough, the elementary school whose PTA members were  targeted is named after Neil Armstrong, the first person to set foot on the moon and an American hero.

And authorities also say the suspects in the alleged scheme also traded on the name of Disneyland to separate victims from their money.

Three California women, including one who already is in prison, swindled investors in an affinity-fraud Ponzi scheme that gathered $14 million, traded on the name of Disneyland and took advantage of parents whose children attended a school named after an American hero, the Los Angeles County Sheriff’s Department said.

All three women were “actively” involved in the Parent-Teachers Association (PTA) at Armstrong Elementary School in  Diamond Bar, Calif., the agency said. The school is named after astronaut Neil A. Armstrong, 80, the first man to set foot on the moon. Armstrong, a former Eagle Scout, also is a recipient of the Presidential Medal of Freedom.

One of the reasons the scam succeeded was that the women gained “the friendship and trust of investors during organized school events and social functions,” investigators said.

“In order to get money, many of the victims took out second mortgages on their homes, maxed out their credit cards and ‘invested’ their life savings,” investigators said.

Losses ranged from $5,000 to $208,000, investigators said.

“The victims were given serialized receipts commonly available in stationary stores,” investigators said.

Arrested in the alleged caper were Maricela Barajas, 41, and Juliana Menefee, 50. Both women resided in Diamond Bar and are being held in the Los Angeles County Jail. Barajas also is known as Maricela Torres.

The third suspect — Eva Perez, 51 — already was in custody. Perez previously was arrested for fraud by the Chino Police Department “and is currently incarcerated in the Central California Women’s Facility, California State Prison,” investigators said.

Perez pleaded guilty last year in San Bernardino County in the same fraud scheme that triggered the Los Angeles County probe and the filing of more charges against her. She was sentenced to 11 years in prison in the San Bernardino case.

Investors plowed about $14 million into the scheme after being told that the women had an exclusive deal to sell AltaDena Dairy products at Disneyland, Disney Hotels and to small retailers, investigators said.

About $4 million of the sum was “retained” by the thieving PTA mothers, and about $2.5 million “has not been directly accounted for” and may have been spent on vacations and gambling, investigators said.

Until its detection, the scheme succeeded in part because the PTA Moms recycled $10 million back to investors, thus creating the impression that the women were at the helm of a successful enterprise, investigators said.

Investors were told that cash was required to become an investor and that their money was safe and guaranteed. At least some of the more than 40 victims were told they’d receive a return of 100 percent, investigators said.

As the Ponzi was unraveling and payments stopped, the thieving PTA Moms “organized informational meetings, and attempted to pacify investors by explaining the delays in payment were a result of an internal audit of the business,” investigators said.

“The victims are mostly typical, hard-working people,” investigators said. “When they were interviewed by sheriff’s detectives, their main reaction was to emotionally describe their embarrassment that they fell for this scheme. They said they saw others making a lot of money and didn’t want to miss out on the opportunity to make a better life for themselves and their families. They are in hopes that people who hear about what happened to them, will look for the warning signs that they ignored, and not have this happen to them. They also made the mistake of investing in people they thought they could trust.”

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9 Responses to “3 PTA Moms Charged In Alleged California Ponzi Swindle; Suspects Claimed They Had Exclusive Deal To Sell Dairy Products At Disneyland, L.A. County Sheriff’s Department Says”

  1. Patrick has anyone ever come to you to ask to do a weekly 30 minute T.V. show on all this ponzi scam stuff. How can we educate all of America about “to good to be true”

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  2. Patrick:

    If Pastors, Rabbi’s, Attorney’s, CPA’s, Hedge Fund Managers, Stock Broker’s, Financial Planners, Insurance Agents, Chiropractor’s, Architect’s, Retired Police Officer’s, Talk Show Hosts are running these Ponzi’s, why would someone from the PTA be a surprise?

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  3. Lynn wrote: If Pastors, Rabbi’s, Attorney’s, CPA’s, Hedge Fund Managers, Stock Broker’s, Financial Planners, Insurance Agents, Chiropractor’s, Architect’s, Retired Police Officer’s, Talk Show Hosts are running these Ponzi’s, why would someone from the PTA be a surprise?”

    I replied: Given the state of current affairs, it shouldn’t be surprising, but it always is, Lynn.

    If these allegations are true, it means that parents doing the right thing by being participants in their children’s school lives were viewed as just another group of marks.

    That’s distasteful enough. But the fact that the school is named after one of the most celebrated Americans of all-time and a major figure in world history, well, that just took it over the top for me.

    Throw in the Disneyland angle, and the story just screams that NOTHING is permitted to be sacrosanct in Ponzi America — not PTA parents, not the name of Neil Armstrong, not the name of Disneyland.

    Patrick

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  4. admin: If these allegations are true, it means that parents doing the right thing by being participants in their children’s school lives were viewed as just another group of marks.

    I would argue that, to the increasingly large substrata of society responsible for the increase in the number of these frauds, PTA mums would be a prime target, not just “another group”

    To them, traditionally off limits marks, such as the elderly, disabled, church groups and PTA members make “better” targets.

    They are slower, more trusting, less likely to physically retaliate and more likely to be in need of additional income and/or be able to access lump sums i.e. superannuation and savings.

    More importantly, perhaps, studies have shown such groups are also more embarrassed and therefore less likely to involve law enforcement agencies.

    To the Andy Bowdoins of this world, “Never give a sucker an even break” is not just a line from some corny ’50s movie.

    It’s a way of life.

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  5. Quick note:

    Longtime readers will recall our coverage of the alleged Mantria/Speed of Wealth Ponzi scheme. It allegedly was a form of “green” affinity fraud and sucked in a bunch of people concerned about the environment. Mantria was very popular in Colorado.

    Here is some recommended reading — a story reminiscent of the Trevor Cook Ponzi because of the elements of affinity fraud and boozing going on behind the scenes:

    http://www.5280.com/print/110073

    Patrick

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  6. littleroundman: “Never give a sucker an even break”

    Hi LRM,

    I remember the video of Andy Bowdoin in Las Vegas in May 2008 — and how there were gasps of glory in the crowd when he referenced God.

    “We need to have an attitude of gratitude with God,” Bowdoin told the audience. “And I always say, ‘Thank you, God, for developing me into a money magnet.’ And I see myself as a money magnet in attracting money and, I say, attracting large sums of money.”

    http://patrickpretty.com/2009/05/07/special-report-the-largely-unknown-bowdoin-surf/

    Now, some of the ASD troops say they want to help Bowdoin raise $500,000 to pay for lawyers. Naturally they want some, most or all of the money to come from ASD members fleeced in an alleged $110 Ponzi scheme.

    http://patrickpretty.com/2011/07/03/dialing-up-the-bizarre-purported-fundrasing-army-displays-photo-of-accused-adsurfdaily-huckster-andy-bowdoin-smiling-ear-to-ear/

    Patrick

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  7. admin: “We need to have an attitude of gratitude with God,” Bowdoin told the audience. “And I always say, ‘Thank you, God, for developing me into a money magnet.’ And I see myself as a money magnet in attracting money and, I say, attracting large sums of money.”

    Now we have one instance, at least, where Bowdoin was NOT lying through his teeth.

    Being a true sociopath, Bowdoin probably still blames the “members” for misinterpreting what he was saying.

    He WAS a money magnet and he WAS attracting large sums of money and he quite probably DID give thanks.

    His victims’ main mistake was assuming Bowdoin ever intended they should do the same.

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  8. I keep thinking that the down economy will shake out all of these bubbles at some time but I continue to be proven wrong.

    I can understand how the autosurf schemes can appeal to large number of people who put in relatively small amounts but I can’t understand how the larger ponzi schemes keep coming out of the woodwork. John Kenneth Gailbreath talked about the “bezzle” shrinking in hard times when people are more suspicious about money. It just doesn’t seem to happen in this economy.

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  9. One word:

    “desperation”

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