INCREDIBLE: Texas Forex Fraudster Allegedly Scammed Georgia Attorney Now Jailed In $40 Million Ponzi Scheme; Mark E. Rice Accused By CFTC Of Ripping Off Seminar Swindler Robert P. Copeland

In a case that could provide even more inspiration for lawyer jokes and black comedy on America’s epidemic of white-collar crime and hucksterism, the CFTC has gone to federal court in Texas to accuse an alleged Forex scammer of defrauding a Georgia attorney now serving a 10-year prison sentence for ripping off senior citizens in a $40 million Ponzi and fraud scheme.

Mark E. Rice, the alleged Forex fraudster, was not registered with the CFTC “in any capacity,” the agency said. He is accused of ripping off attorney Robert P. Copeland of Marietta, Ga.

In August 2009, Copeland, whom federal prosecutors said practiced “elder law,” was sentenced to 10 years in federal prison for swindling retirees in a five-year, $40 million Ponzi caper involving bogus real-estate investments and at least 125 victims. Copeland recruited victims at seminars and doled out “commissions” to people who helped him line up business, according to prosecutors.

U.S. District Judge Lee H. Rosenthal of the Southern District of Texas has frozen the assets of Rice and his company, Financial Robotics Inc. (FinRob) of Houston.

Copeland surrendered his law license and received the equivalent of a disbarment in June 2009 from the Supreme Court of Georgia, according to records in Georgia.

Prior to his 2009 conviction for wire fraud in the Ponzi swindle, Copeland plowed $10.4 million into Rice’s alleged Forex swindle — and the money came from Copeland’s investors in the Ponzi scheme for which he was imprisoned, the CFTC alleged.

Rice, of Sugar Land, Texas, began to pitch Copeland on managed Forex in 2006, prior to the 2009 exposure of the Copeland real-estate Ponzi scheme, according to court records. Rice told Copeland that his investment was “risk free” and “insured against loss,” the CFTC said.

While soliciting Copeland, Rice told him that he and his firm had developed automated Forex software trading programs that had generated “phenomenal returns” of 30 percent a month while being tested in Europe and the United States and 30-day returns of between 10 percent and 15 percent in actual trading, the CFTC alleged.

Copeland’s trading with Rice initially started with a $502,000 investment in 2007. Between March 2007 and August 2008, Copeland plowed an additional $9.9 million into the Forex scheme after Rice allegedly told him that Rice was “going to move all of his investments to England, as that market could provide greater returns than the American market,” the CFTC said.

By September 2008, Rice presented Copeland a “spreadsheet” that showed the value of Copeland’s investment had grown to $15 million — and Copeland contemplated cashing out, the CFTC said.

But Rice persuaded him that the $15 million would turn into $20 million by January 2009, and Copeland decided not to liquidate his account.

In November 2008 — just two months after Rice told Copeland that $20 million would be on the table for him in January — Rice told Copeland that “all” of his funds “purportedly” had been lost in trading, the CFTC said.

Later, in February 2009, Rice told Copeland that the account never had been insured against loss.

By April 2009, according to records, Copeland’s own Ponzi scheme had come tumbling down — and the SEC was investigating.

“This case is particularly disturbing because the defendant was a lawyer and many of his victims were senior citizens, some of whom lost their life savings,” said then-U.S. Attorney David E. Nahmias in April 2009. “[Copeland] is now cooperating in the ongoing investigation and in our efforts to recover whatever assets are left, but he will still face the punishment that this devastating crime requires.”

In August 2009, Copeland was sentenced to 121 months in federal prison.

The CFTC did not say whether the cooperation Copeland pledged two years ago had resulted in the charges against Rice.

Whether victims of Copeland’s Ponzi scheme can expect a recovery from assets frozen in the emerging Rice case was not immediately clear. At his August 2009 sentencing, Copeland was ordered to pay about $16.7 million in restitution.