Forex Ponzi Schemes: How "money managers" steal your money
Michael Riola was charged with five accounts of fraud for stealing investors' money in a Florida Ponzi Scheme Ponzi Scheme A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and Read this Term. Just like the infamous Bernard Madoff.
These "money managers" promise you tens of percents of returns a month, blatantly lieing and covering their previous losses. The more they lost the more returns they had to promise in order to keep up with the returns the previous investors were expecting. Once they entered this vortex they never had the decency to pull themselves out of it by admitting the truth.
Beware of all people promising you unthinkable returns. The known rule applies here as well: If it sounds too good to be true don't touch it. If the person selling this to you seems slick or shady, don't touch it. Same goes for all these automatic trading robots, they too promise 50 and 100% returns a month - DON'T TOUCH IT.
The following was reported by Reuters:
Florida money manager took in $44 million from investors in a Ponzi scheme that purported to make profits by trading on currency markets, U.S. prosecutors said on Thursday in a criminal complaint.
Michael Riolo, 37, of Boca Raton, was charged with five counts of mail fraud.
Riolo used two companies he owned, Sterling Wentworth Currency Group, Inc and LaSalle International Clearing Clearing Clearing is a general term that simply means many different things depending on the subject and related industry. Most commonly, this refers to the reciprocal exchange between banks of checks and drafts, and the settlement of the differences, or the total of claims settled at a clearinghouse. In finance and banking, the word clearing has different meanings depending on the more specific business model. Moving checks from the bank where they were deposited to the bank on which they were drawn. Th Clearing is a general term that simply means many different things depending on the subject and related industry. Most commonly, this refers to the reciprocal exchange between banks of checks and drafts, and the settlement of the differences, or the total of claims settled at a clearinghouse. In finance and banking, the word clearing has different meanings depending on the more specific business model. Moving checks from the bank where they were deposited to the bank on which they were drawn. Th Read this Term Corp, to purportedly trade futures contracts in the yen, euro, Swiss franc and other currencies, said a criminal complaint filed in U.S. District Court in south Florida.
He issued "materially false statements" to persuade more than 80 investors to commit at least $44 million from 1999 to 2008, prosecutors said.
"Instead of using investor monies to trade in foreign currency, Riolo used investor funds for other purposes, including Riolo's personal use and benefit," the U.S. Attorney's Office in Miami said in a statement.
Riolo issued monthly statements that falsely reported trading profits and increasing account balances and allegedly distributed more than $29.5 million to investors as a return of principal and profits when most of it came directly from new investors, prosecutors said.
Riolo faces up to 20 years in prison on each count.
Neither Riolo nor his lawyer could be reached immediately for comment.
Florida investors have been rocked by high profile Ponzi schemes in recent months.
The wealthy east coast resort town of Palm Beach was hard hit by the $65 billion fraud of New York money manager Bernard Madoff. On the state's west coast, authorities arrested hedge fund manager Arthur Nadel in January in an alleged $360 million fraud that spanned 10 years.
Michael Riola was charged with five accounts of fraud for stealing investors' money in a Florida Ponzi Scheme Ponzi Scheme A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and Read this Term. Just like the infamous Bernard Madoff.
These "money managers" promise you tens of percents of returns a month, blatantly lieing and covering their previous losses. The more they lost the more returns they had to promise in order to keep up with the returns the previous investors were expecting. Once they entered this vortex they never had the decency to pull themselves out of it by admitting the truth.
Beware of all people promising you unthinkable returns. The known rule applies here as well: If it sounds too good to be true don't touch it. If the person selling this to you seems slick or shady, don't touch it. Same goes for all these automatic trading robots, they too promise 50 and 100% returns a month - DON'T TOUCH IT.
The following was reported by Reuters:
Florida money manager took in $44 million from investors in a Ponzi scheme that purported to make profits by trading on currency markets, U.S. prosecutors said on Thursday in a criminal complaint.
Michael Riolo, 37, of Boca Raton, was charged with five counts of mail fraud.
Riolo used two companies he owned, Sterling Wentworth Currency Group, Inc and LaSalle International Clearing Clearing Clearing is a general term that simply means many different things depending on the subject and related industry. Most commonly, this refers to the reciprocal exchange between banks of checks and drafts, and the settlement of the differences, or the total of claims settled at a clearinghouse. In finance and banking, the word clearing has different meanings depending on the more specific business model. Moving checks from the bank where they were deposited to the bank on which they were drawn. Th Clearing is a general term that simply means many different things depending on the subject and related industry. Most commonly, this refers to the reciprocal exchange between banks of checks and drafts, and the settlement of the differences, or the total of claims settled at a clearinghouse. In finance and banking, the word clearing has different meanings depending on the more specific business model. Moving checks from the bank where they were deposited to the bank on which they were drawn. Th Read this Term Corp, to purportedly trade futures contracts in the yen, euro, Swiss franc and other currencies, said a criminal complaint filed in U.S. District Court in south Florida.
He issued "materially false statements" to persuade more than 80 investors to commit at least $44 million from 1999 to 2008, prosecutors said.
"Instead of using investor monies to trade in foreign currency, Riolo used investor funds for other purposes, including Riolo's personal use and benefit," the U.S. Attorney's Office in Miami said in a statement.
Riolo issued monthly statements that falsely reported trading profits and increasing account balances and allegedly distributed more than $29.5 million to investors as a return of principal and profits when most of it came directly from new investors, prosecutors said.
Riolo faces up to 20 years in prison on each count.
Neither Riolo nor his lawyer could be reached immediately for comment.
Florida investors have been rocked by high profile Ponzi schemes in recent months.
The wealthy east coast resort town of Palm Beach was hard hit by the $65 billion fraud of New York money manager Bernard Madoff. On the state's west coast, authorities arrested hedge fund manager Arthur Nadel in January in an alleged $360 million fraud that spanned 10 years.