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New York man allegedly funds gambling with Ponzi scheme

A 51-year-old man from Oceanside faces the possibility of decades in prison if convicted of wire fraud and wire fraud conspiracy charges stemming from his alleged Ponzi scheme. The FBI and the U.S. Attorney's Office for the Southern District of New York worked in partnership with the Nassau County District Attorney's Office to investigate the man's activities over several years. Their findings indicate that he used investors' money to finance his gambling and otherwise enrich himself.

According to authorities, he convinced over 80 people to invest approximately $13.1 million in his jewelry companies. Investors believed that their large sums of money would earn high returns at the end of a fixed term. The man allegedly told them that he would buy gold and other valuables for refinement and jewelry making. Investigators assert that he never purchased any materials. Instead, he appeared to be paying investors with money from new investors, which represents a classic Ponzi scheme.

Investors claim to have lost about $6.3 million over the course of five years. The Nassau County district attorney said that the man promised high returns but instead issued checks to himself from his companies.

A person accused of running a Ponzi scheme could face serious consequences if convicted, including prison and restitution. A criminal defense attorney might consult an accountant to gain testimony that might offer an alternative interpretation of financial records than that made by prosecutors. The attorney could also argue that the defendant did not possess the specific intent to defraud, which is an essential element of the charge.

Source: Long Beach Patch, "Nassau Man Charged With Running Multi-Million Dollar Ponzi Scheme", Alex Costello, March 30, 2017

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