Ponzi Scheme of the Day
It’s hard to keep up with such things, but today my favorite alleged Ponzi scheme involves some Atlanta-based currency traders who the SEC says took investors for $25-million. In addition to promising returns they couldn’t deliver, the SEC says the following in the litigation release:
CRE and Ossie have also represented to potential investors that CRE is planning on making a $100 million stock offering in early 2009, and that the offering will not be registered with the SEC. In connection with the stock offering, CRE and Ossie have told investors in conference calls that CRE business operations have been analyzed by an independent firm for estimation of stock value, and that the firm opined that CRE stock should be worth $40 to $45 per share. Given that CRE is insolvent, there is no reasonable basis for this statement. [Emphasis added]
Nice. If only all equity valuation were so easy.
Further down, I’m also fond this Get Out of Jail Free assertion in the release:
On information and belief, on Friday, January 9,2009, CRE and Ossie represented to investors on a conference call that CRE could no longer make ROI payments to investors because the SEC had allegedly frozen its accounts. This statement was false.
Right, but it’s true now, right?. These guys actually can call the market.
More here.