by Brian Mahany
Our firm concentrates in fraud recovery. Frequently the frauds we handle involve Ponzi schemes. By the time the fraud comes to light, there are very few assets to recover. Some victims rely on court appointed receivers. Sometimes that works but often the result is a recovery of just pennies on the dollar.
The best fraud lawyers understand that the only win to truly win is to get back the client’s money. A judgment against a Ponzi schemer spending the rest of his life in prison isn’t worth very much. To get back a client’s money means finding third parties who have some responsibility for the fraud and deep pockets. A recent case against Bank of New York Mellon is a case in point.
Readers of this blog know that investors in Medical Capital Holdings lost approximately $1 billion after the SEC discovered that MedCap was a Ponzi scheme. Unfortunately, when the SEC finally got involved, much of the money was long gone.
Many investors sued their stockbroker and the broker dealer that sold them the MedCap investment. Unfortunately, in a billion dollar scam, it didn’t take long for several broker dealers to simply go under from the sheer size of the claims. That means no money for the victims, just another uncollectible judgment.
Some investors sued Wells Fargo and BONY, the trustees for MedCap. Although neither bank was accused of stealing investor funds or participating in the Ponzi scheme, as trustees they should have known what was going on within the beleaguered MedCap. The lawsuits say that the banks received excessive fees while turning a blind eye on what MedCap was doing with the investor monies.
Last week, the settlement with banks were revealed. Under the terms, the bank will pay $114 million to settle claims brought by the investors. The court must still approve the settlement.
The lesson here? Don’t give up. Even if the money is long gone and the perpetrators are in jail, often a good asset recovery lawyer can back your hard earned money. Anyone who sold a bad investment, improperly audited the promoter or acted as trustee may be liable.
There is often a “deep pocket” that has some responsibility for the losses.
If you lost your hard earned money in a Ponzi scheme, abusive tax shelter transaction or because of bad investment advice should call us. Our fraud recovery lawyers have helped many people get back their hard earned money. Most cases can also be handled on a contingent fee meaning no legal fees unless you get back your money.
Mahany & Ertl – America’s Fraud Lawyers. Offices in Milwaukee, Wisconsin; Detroit, Michigan; Portland, Maine; Minneapolis, Minnesota and San Francisco, California. Fraud recovery available in many jurisdictions.
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