In the words of Warren Buffett, “You always find out who’s been swimming naked when the tide goes out.” But recent months have shown that the nudist beach extended far beyond Wall Street, and beyond the dreams of pioneering schemer Charles Ponzi (above).
For those following along at home, here is a run-down of alleged Ponzi schemes and other scams that have recently emerged during the financial crisis. Pay attention: you can’t tell the faked deaths without a scorecard.
This Long Island businessman purported to provide commercial bridge loans, but was instead operating a $400 million Ponzi scheme in which early investors are paid with the money of new clients, officials said.
Cosmo was previously convicted of a federal charge of felony fraud and swindle in 1999 and sentenced to 21 months in prison. According to the firm’s website it has made commercial bridge loans, construction loans, acquisition loans and financing for properties nationwide with capital obtained from private sources since 1999.
The SEC charged Nadel with defrauding investors at six hedge funds he controlled. Nadel overstated the value of the funds by more than $300 million, providing bogus information on their returns and sending investors false statements, the SEC said. The actual value of the funds’ holdings was about $507,000.