It may be difficult for the SEC to pinpoint if the latest round of Ponzi schemes involving retired bus drivers, the elderly and Cuban-Americans were credit union members.
Since March 3, the commission has stopped three separate investment scams which collectively have impacted investors to the tune of nearly $170 million. The head of a Miami-based real estate firm and his wife allegedly promised elderly Cuban-Americans with annual returns between nine and 16% if they invested in Royal West Property Inc. The SEC said Gaston E. Cantens and Teresita Cantens used new investor money to repay earlier investors and misappropriated millions from investors to pay the Cantens' salaries and their children and grandchildren.
The SEC also filed fraud charges against Mitchell, Porter and Williams Inc., a Los Angeles investment advisory firm for a $14.7 million Ponzi scheme targeting retired bus drivers. Thomas L. Mitchell, the firm's owner, solicited clients to invest their retirement money in promissory notes offered by two other entities he operated guaranteeing 10 to 15% returns. Instead, Mitchell used money from new investors to pay existing ones.
On March 10, the SEC obtained an emergency order to stop USA Retirement Management Services from soliciting retirees in California and Illinois to attend estate planning seminars. USARMS raised at least $20 million from 120 investors to invest money in Turkish Eurobonds. As with the other Ponzis, managing partners Francois E. Durmaz and Robert C. Pribilski used existing investors' funds to pay new investors.