Wednesday, December 9, 2009

SEC Blocks Early-Stage Ponzi Scheme

Sometimes good things come from a massive failure. Ever since the mis-steps of the SEC have come to light, the SEC has been pouncing on various frauds and schemes and taking swift action. It was typical for the SEC to be the last one on the scene, franticly trying to close the barn door after all of the horses had left and were scattered to parts unknown.

In the last few months we have seen at least four cases where the SEC shut down a scheme as it was getting started. Today the SEC announced that it has halted a Ponzi scheme involving a New York firm that solicited investments involving personal injury lawsuit settlements but instead shipped the money overseas. The SEC obtained a court order freezing the assets of the firm, its president, and several companies holding money from the scam that began several months ago.

Kudos to the Commission for taking swift action. Let's just hope that this swiftness is the result of increased market survelliance, retention of experienced and motivated staff and an renewed vigor, and not the result of a rush to judgment and press releases without evidence or foundation. Time will tell.  More>>>

Post a Comment