Tag: IRS Criminal Investigations Unit

EDITOR’S NOTE: UPDATED 9:22 P.M. EDT (June 7, 2010, U.S.A.) This post is presented in seven parts. With the exception of the lengthier introduction, each part includes six to eight paragraphs. You’ll see a “GO TO PAGE” prompt at the bottom of each section. Simply click on the next page number to continue reading.

The post takes a stark look at two recent court cases. WARNING: Some readers may find the content objectionable because it describes family-unfriendly events that occurred as a result of HYIP Ponzi schemes that operated in the Forex and futures spheres and promised huge returns. We are publishing the post because we believe it is in the public interest to do so. It reflects this Blog’s view that Ponzi apologists and pitchmen pushing unrealistic, unsustainable returns on forums and though other forms of mass communication are undermining family economies and regional economies, while threatening national economies and posing significant security risks to the nations of the world.

If you are still pushing HYIP and investment-fraud schemes on the Ponzi boards, lying to yourself by clinging to the notion that such schemes are “games” and you’re causing no real harm by promoting them or introducing people to the “opportunities,” be advised that these cases may interrupt your fantasy.

One of the cases is about how a woman who thought she had met a successful and generous man through an online dating service was ordered to surrender her property in Florida, despite the state’s famous Homeowner’s Exemption. The second case is about how a woman who became romantically involved with a Ponzi schemer lost just about everything. At the moment, there are hundreds of Ponzi and fraud cases with significant social and economic consequences either being investigated or working their way through the courts.

We’ll start the editorial with the case involving the Florida woman who lost her home because it was paid for with Ponzi proceeds, even though she was unaware she had been given money from a Ponzi.

After we outline the Florida case, we’ll turn your attention to a separate case in Tennessee in which a woman who received illegal proceeds from her Ponzi operator/paramour lost the value of a home paid for with Ponzi proceeds and lost the value of hundreds of thousands of dollars in cash and gifts that flowed from the Ponzi.

The paramour in the Tennessee case, Luis H. Rivas, initially fled after being exposed. He ultimately was captured, arrested, charged in both federal and state courts and convicted. In November, he was sentenced to nearly 25 years in prison. Meanwhile, federal records show that the woman, Pamela Morgan, now owes the Rivas bankruptcy estate $235,100 to cover fraudulent cash transfers, $225,000 to cover a fraudulent transfer that was plunked down on a new home, $82,266 to cover fraudulent transfers that led to the purchase of a Volkswagen Toureg, and $9,821 to cover fraudulent transfers that led to the purchase of furniture.

In the end, a federal judge also determined that Morgan owed the estate $11,000 to cover fraudulent transfers that led to the purchase of her engagement ring after she left her marriage for Rivas, who previously had spent years in prison for another fraud scheme.

When Rivas was sentenced by a federal judge in November, some of the victims asked the judge to go light on him or not even to order a jail sentence. After all, they reasoned, should Rivas be permitted to return to the Forex HYIP business, he just might be able to reverse his $35 million fraud and make everybody whole.

That he’d previously been sentenced to more than a decade in prison for running cons and, in fact, had fled when his latest con was exposed somehow did not fully compute. Some victims said they believed he should be set free to resume his purported trading program, thus viewing a $35 million fraud like a traffic-court case in which the defendant was charged with an innocuous offense such as overtime parking and viewing the fraudster himself as the remedy, not the problem.

This sort of thinking is so obviously flawed that it reads like fiction and challenges readers to suspend their disbelief — but it surfaces on a daily basis because both promoters and true victims in the schemes have a profound need to create psychological wiggle room.

In the case of true victims, the wiggle room is needed because acknowledging they have been conned in a fraud and have little hope of making a full recovery simply is too painful to contemplate. In the cases of the Ponzi players and pitchmen, the wiggle room is needed to let them off the hook and to rationalize continued participation in the frauds, which often pay commissions to recruiters for bringing in new marks whose money is used to reward earlier participants in the schemes.

The tortured result is to give aid and comfort to the thieves who caused spectacular losses while at once directing tiny daggers to the law-enforcement agencies, courts, receivers and trustees who suddenly have a glut of Ponzi cases that have consumed billions of dollars and altered the lives of tens of thousands of victims.

If you are collecting commissions and/or salary and payments from such schemes or recommending the schemes to prospects on the Internet, through the mails, through conference calls or other group functions or though other forms of mass communications, you are setting the stage for misery that could lead to the sort of court actions described in this post.

This misery includes protracted litigation, insoluble personal problems, romantic conflicts, conflicts with friends, family and acquaintances, attorneys’ bills, dispossessions and hourly, spirit-crushing stress.

Promoter? Awake yet?

What you are doing by involving yourself in HYIPs and investment frauds as a promoter or wink-nod cheerleader is deluding yourself by slipping into a convenient psychology that lets you off the hook for the pain you potentially are causing both people you know and strangers alike. While you are arguing that pushing such schemes is a sign that you embrace “freedom of choice” and that only psychologically unhealthy people would see things a different way, you are revealing yourself as a pusher of poison and hiding behind your bogus manta of self-actualization. Your delusion is on display for all the world to see, and your purported journey toward self-discovery is more accurately described as the relentless pursuit of criminal self-indulgence.

God pity the world if your delusions of self-actualization gain a viral following. Bottom line: You are participating in schemes that create endless nightmares, undermine families and family economies, undermine regional economies and threaten national economies and the security of nations worldwide — and you’re trying to sell yourself on the impossible notion that you’re somehow a modern-day freedom fighter and that the rest of society and the reporters and Bloggers who cover the schemes just don’t “get it.”

Take these three things to the bank:

Wherever there is an HYIP or autosurf Ponzi scheme, there is a player railing against the government. Wherever there is an HYIP or autosurf Ponzi scheme, there is a player railing against reporters and Bloggers and forum posters who are trying to educate the public about such schemes and the lengths to which players go to sanitize the schemes and rationalize their behavior, which is a cancer on the world.

And wherever there is an HYIP or autosurf Ponzi scheme, there is a player railing against the court-appointed receiver or trustee. The player paints the false picture that the receiver or trustee’s greed is the issue — all while the player conveniently ignores the fact that the schemers created the situation that made it necessary for the court to appoint professionals to unravel these hugely complex frauds through a supervised, costly, time-consuming process that is undertaken only because of the conduct of fraudsters and their shills and apologists.

With each passing day — as more and more schemes emerge — players are further marginalizing themselves, further identifying themselves not only as a criminals, but as a delusional ones. Society at large does, indeed, “get it.” What it “gets,” plainly, is the correct notion that HYIP and autosurf Ponzi pushers are capable of conflating one convenient reality after another and shaping those realities to fit any awkward or bizarre circumstance that arises.

Despite your claims, neither you nor your marks are being denied freedom of choice. What you’re being denied is the license you divine yourself to commit crimes on a local, regional, national or international scale. If your theories had any validity at all, you’d be permitted not to feed the parking meters in your neighborhood simply because you are you and thus insulated from getting a ticket by the mere circumstance of you being you.

On a grander scale, you’d be permitted to create a license to steal huge sums of money simply because you are, well, you — and thus insulated from prosecution by the mere circumstance of you being you.

But it’s not about you; it’s about the lives you are helping to ruin through your relentless pursuit of thrill profits and your relentless insistence that the cops, the courts, the journalists, the forum critics and the receivers and trustees are all wrong and have ganged up against you in a giant conspiracy to strangle the human spirit and undermine freedom of choice.

Far from being a modern-day freedom fighter, you actually are a modern-day, delusional criminal — one who is waging a war on behalf of fellow criminals. You are cementing the destruction of wealth and potentially ushering in an era of a global Third World economy.

You are dangerous — and the law can’t get to you soon enough. Period.

Here, now, briefs on two cases that interrupt your forum delusions . . .