Boston Accident and Injury Lawyer

September 10, 2009 – Sandra Venetis was allegedly operating her three entities, Systematic Financial Services, Inc., Systematic Financial Associates Inc., and Systematic Financial Services LLC, as a Ponzi scheme. According to the complaint filed by the Securities and Exchange Commission (“SEC”), Venetis bilked investors for at least $11 million since 1997 by promising returns of 6 to 11 percent per year. Apparently, Venetis misappropriated investor funds for her own personal use and for her relatives.

Apparently, Venetis lured investors by offering promissory notes, fixed income investments, and other supposedly lucrative investments. The complaint alleges that Venetis claimed that the promissory notes were backed by the Federal Deposit Insurance Corporation (“FDIC”) and that the interest payments would be tax free. Venetis also apparently told some investors that their money would be used for loans to various doctors backed by Medicare reimbursements. The SEC claims that Venetis completely made up the names of the doctors and falsified their signatures on loan documents.

According to the complaint, the promissory notes and other offerings were not backed by any legitimate investments. Venetis apparently used the money to pay her personal and business debts, as well as finance her gambling and extravagant vacations. Venetis also allegedly bought a house for her daughter and paid for improvements on her brother’s home.

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June 30, 2010 – Daniel Spitzer allegedly operated several business entities as a foreign currency investment fraud, which raised over $105 million from 400 investors. This week, the Securities and Exchange Commission (“SEC”) filed a complaint that claims Spitzer misled investors from at least 2004 until as recently as March 2010. Spitzer, a resident of St. Thomas, recruited investors from all over the United States.

According to the complaint, Spitzer and his sales team told investors that their money would be placed in investment funds that would, in turn, primarily be invested in foreign currency. Spitzer allegedly enticed new clients by claiming he was an extremely successful fund manager and always produced exorbitant annual returns, including one year of 180%. To facilitate his purported scheme, Spitzer allegedly issued phony documents, including false K-1s, to clients.

The SEC claims that, in reality, Spitzer only invested $30 million of client funds, including $16.5 million in a foreign entity that ultimately lost money and was liquidated back to Spitzer. Spitzer also apparently invested $16 million in money market funds but only earned a few thousand dollars.

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June 17, 2010 – Milowe Brost, Gary Sorenson, Larry Adair, Ward Capstick, Bradley Regier, and Martin Werner allegedly operated their entities Syndicated Gold Depository, Merendon Mining Corp. Ltd., Merendon Mining (Nevada) Inc., and the Institute for Financial Learning Group of Companies, Inc. as a massive $300 million Ponzi scheme. Last week, the Securities and Exchange Commission (“SEC”) filed a complaint that alleges Brost and Sorenson were the leaders of the alleged Gold mining fraud, which convinced 3,000 investors to cough up large amounts of money.

The SEC claims that Brost led a sales team, called Structurists, which held investment seminars where they claimed to be independent financial professionals. At the seminars, the men allegedly pushed investments in gold mining businesses that could generate annual returns ranging from 18 to 36 percent.
The SEC also alleges that Brost and the Structurists promised that all investments were collateralized by gold.

The complaint claims that Brost and his sales team sold shares in various entities and then through a unique “structuring” process that ultimately led to the transfer of funds from Syndicated Gold Depository to Merendon Mining Corp. Ltd. Apparently, Sorenson claims to be an independent businessman making loans to Merendon, but in reality controlled the company.

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