Florida Residents Should Be Aware of Investment Schemes

Investment fraud can happen to anyone, however, Florida’s a state rich in scam artists because of the large number of senior citizens and retirees who reside in the state.
Florida’s economy isn’t fantastic, yet it’s a state rich in retirement funds which makes Florida residents targets for investment schemes. 

If you’ve been taken advantage of or believe that there has been broker mismanagement of funds, fraud or securities or investment losses due to the negligence of a broker, don’t write it off as a loss. Consult with Eric Lanigan and Roddy Lanigan. 

The Lanigans will work with you to determine whether you can recover the losses if fraud or theft has occurred.

 Floridians of All Ages Have to be Careful Investors

Fraudulent investments include mortgage fraud, Ponzi schemes, MLM (multi-level marketing), get-rich-quick investments, or investment losses due to irresponsible broker behaviors.

Since January 2011 there have been several individuals charged or sentenced for fraudulent investments:

  • Scott Rothstein pleaded guilty in January 2010 to five counts of racketeering, money laundering and wire fraud, admitting he sold investors interests in bogus settlements in sexual-harassment and whistleblower suits. He was sentenced to 50 years in prison for taking people for $1.2 billion in Florida, and other parts of the U.S., Europe and Asia.
  • The FBI Miami Field Office charged five defendants in connection with violation of securities laws. Specifically, the cases charged “microcap” stock market insiders and promoters.
  • Microcap stock refers to companies with low capitalizations, meaning the total value of the company’s stock. Microcaps usually have limited assets and its stocks tend to be low priced and trade in low volumes.
  • To date, the Securities and Investment Fraud Initiative has yielded 16 convictions related to microcap stock fraud.
  • In July 2011, a Gainesville man pleaded guilty to a $30 million dollar willfully engineered and executed a scheme to defraud by promising victim investors that he could generate returns of up to 10 percent per month, compounded monthly, through his trading in the foreign currency (forex) market.  
  • The Gainesville man operated an investment fraud scheme.  He and others working at his direction raised approximately $29,851,598 from victim investors, but the defendant used only a small percentage of those funds for forex trading (approximately $2.6 million), the vast majority of which he lost.

Anyone Can Be a Victim of Fraud

Florida’s Financial Industry Regulatory Authority said that investment-fraud victims tend to be well-educated males who have higher levels of income and education than non-victims. They are self-reliant and confident when it comes to their investments and also have had a recent change in their financial circumstances.

Those changes include home foreclosures, lost jobs or diminishing stock investments. Many victims refuse to admit they have been scammed, Walsh said.

Likely victims:

  • Male, mid-40s, career or financial change, confident, not likely to ask advice
  • Teachers
  • Early retirees
  • Unemployed who received severance packages or buyouts
  • Isolated, lonely seniors with few family, friends

Scams Arrive By:

  • Phone
  • E-mail
  • Mail
  • In-person
  • Online

Millions of seniors in Florida Live on Long-term Savings

Stock market volatility makes individuals who have money to invest look for sure things. High income individuals are approached to invest in ponzi schemes or businesses that don’t exist. Real estate fraud and more than ever “solid and unchanging investments.”

Florida has also long been prone to Medicare and mortgage fraud.

Increase in Fraud Since 2010

The Financial Fraud Enforcement Task Force is composed of 25 federal agencies and state partners to confront the growing problem. In late 2010, prosecutors brought 211 criminal cases and 60 civil suits alleging financial fraud that had victimized more than 120,000 Americans.

StopFraud.gov, a website where fraud is reported from across the country features multiple stories of the elaborate plans hatched by criminals who go to extremes to carry out elaborate investment scams

Consumer Mortgage Fraud Continues in Florida

The FBI said in an annual report that mortgage scams rose 12 percent in the fiscal year ending September 2010, to 3,129 cases–a 90 percent jump from 2009.

There were 27 people arrested in Miami Dade County in August for multiple elaborate mortgage fraud scams that included false documentation, straw buyers, filing double documentation, arson, false competitive buyers to push up the price of a property, money laundering and other charges.

Florida Fraud and Investment  Cases Expected to Rise

The multiple cases in the state have involved millions of dollars that were scammed from banks, businesses, investors and individuals. The number of fraud cases is expected to rise and continue with the poor economy as criminals become more desperate and more cunning.

If you’ve been  ripped off, have suffered extreme investment losses due to careless broker behavior, or have been a victim of a security or investment loss, consult with Eric Lanigan and Roddy Lanigan. Call for a meeting with the Lanigans in their Winter Park, Florida, office. Your situation will be assessed and you will be advised what your options are to recover your losses and what you can do if fraud has occurred.