Frank A. Rubino, ESQ.

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Guilty Plea in $130 Million Ponzi Scheme Prosecution

Prosecutors apparently reached a plea deal in a massive Ponzi scheme investigation. The deal requires the 62-year-old defendant to plead guilty to 18 criminal counts. According to guilty plea, the Ponzi scheme sold high-yield certificates of deposit to 1,200 investors.

Investigators accused the defendant in 2009 after the scheme operated for ten years. The defendant apparently offered fictitious CDs from his three separate financial entities, two of which were located in the Caribbean and Switzerland. Between 2004 and 2009, the defendant and another person sold $129.5 million of CDs.

Although the government accused the defendant in 2009, it did not seek a grand jury indictment until February, 2012. The grand jury charged him with 18 criminal counts and the defendant pled guilty to all charges.

One of the charges was for conspiracy to commit mail fraud. The crime of conspiracy is essentially a criminal agreement. Unlike charges for attempting to commit a crime, the government can prosecute both a conspiracy charge and a count for the actual completed crime. Thus, the agreement to commit a crime is deemed independent of the crime itself. Defendants can face conspiracy charges even if they never complete the planned crime.

This defendant will face a sentencing sometime next spring. Given the multi-million dollar scale of this scheme, he could face many years in prison and enormous financial penalties.

Source: Wall Street Journal, "Alleged Ponzi Schemer to Plead Guilty," Ben Fox Rubin, Sept. 14, 2012

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Coral Gables Office

Frank A. Rubino, Esq.
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Coral Gables, FL 33134

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