Colorado Securities Commissioner Tells Durango Herald: ‘They Want So Badly To Believe In The Tooth Fairy’

Joe Hanel, the Denver correspondent for the Durango Herald, has written a series of reports that delves into the symphony of the bizarre surrounding Ponzi schemer Frederick H.K. Baker, who once was immersed in the HYIP world but now is in prison.

If you’ve been wondering about the psychology of Ponzi schemes — perhaps particularly in the HYIP sphere, where victims may condemn the government for moving against obvious frauds — you’ll find value in the Herald series.

The first installment is titled, “A man, a plan, a scam.” Part II is titled, “Scammers often earn victims’ trust through shared hopes, dreams, beliefs.” Hanel then delivers Part III, “After the scheme collapses, scammers recede into shadows.” Part IV perhaps has the most memorable title of all, “For a Ponzi payout, call the tooth fairy.”

Part IV gets its title from a comment by Fred Joseph, Colorado’s securities commissioner. “They want so badly to believe in the tooth fairy,” Joseph told the paper.

What sparked the comment was a recollection by Joseph that he once had to work hard to convince a resident of the state “not to send $50,000 to Belgium for the promise of getting millions in return,” according to the Herald.

Here’s hoping the Herald series gets high readership.

A snippet from Part I of the series (italics added):

A few million dollars spent the winter in sunny Los Angeles with a company whose president now is on death row. When the law closed in, Baker moved the money to Portugal, placing it in the trust of a company registered in New Zealand, with an address in Panama and directors in the United Kingdom.

That’s when it disappeared.