In a headline that is all too familiar, two men will spend the next five years in federal prison after they were found guilty of duping investors to the tune of $2.4 million.
The Tarranty County duo operated a Ponzi scheme, involving 21 investors, from 2004 through 2014. Fake companies were created, phone numbers and out-of-state mailboxes were ordered, and, when investors requested account statements and tax forms, they responded with fabricated information.
It can feel nearly impossible to protect yourself against these types of criminals. After all, a company name is registered, there’s a phone number to call, and documents are sent showing your investment and how much it’s appreciated.
So what can you do to protect yourself and your investments?
We tried one case last year over an investment fraud matter and obtained a verdict of close to $3-million dollars. Just last week, we successfully obtained an arbitration award against licensed stock brokers (and the brokerage firm) for approximately $2-million dollars. These were scams perpetuated by seemingly professional, trustworthy individuals. However, in regard to the arbitration matter, patently false information was provided to our client about the status of their investment account.
Greed is endemic in mankind, now perhaps more than ever. And those who exploit others to fulfill their own selfish gain are more sophisticated than ever. No matter how honest a person seems to be, or how big and professional an organization is, an investor is not truly ever safe from those who scam others. Thus, people must be vigilant and cautious.
Investors should seek several layers of accountability within the organization that is overseeing their money. And, if they ever sense even the slightest impropriety, they should seek legal counsel for guidance. There are plenty of times when people wait so long to take action that the damage is far worse than it would have been if addressed early.
Moreover, the passage of time can completely eradicate one’s ability to pursue claims by virtue of operative statutes of limitations. Thus, be vigilant, ask questions, have layers of protection within the investment firm, and seek counsel even before you think you should.
