Identity Theft Complaints Rise 20 Percent

The number of identity theft complaints have risen around 20 percent from 2007, reports the FTC.

Identity theft represents 26 percent of all consumer fraud complaints, followed by third-party and creditor debt collection, catalog sales, and Internet services.

While 20 percent was pure credit card fraud, government documents or benefits fraud accounted for 15 percent, employment fraud for 15 percent, and phone or utilities, 13 percent.

The increase may be due to several factors, including the high number of enterprise breaches last year, as well as fallout from the financial crisis.

Two more arrests for securities fraud

Two men who managed investment funds for New York colleges and charities, among many, were arrested yesterday on securities fraud charges.

AP reports that Paul Greenwood, 61, and Stephen Walsh, 64, raided their clients’ funds and spent the money on horses, collectibles and personal items. Greenwood, according to the report, is also an elected official in New York State.

A judge set bail at $7 million for each of the defendants and they must post $1 million of money not gained from their scam to get out of jail.

That same day, authorities were also making an arrest on James Nicholson, 42, on charges he bilked $100 million out of clients since 2004.

Nicholson can only thank those that probably inspired him to conduct his business the way he did. Apparently his clients went to remove their money from accounts with Nicholson after reports first surfaced about high-profile securities fraud cases involving Bernard Madoff, Arthur Nadel and Robert Stanford.

Thursday’s reports are just three among a growing number of securities fraud cases. Thousands of investors are out thousands, if not millions of dollars through these ill-fated scams.

Senator’s Foundation Sues Madoff’s Brother

The family foundation of a New Jersey senator is suing Bernie Madoff’s brother over their losses in the alleged Ponzi scheme.

U.S. Sen. Frank Lautenberg’s foundation says it invested $7.3 million with Madoff in 2001 and 2002.

Lautenberg foundation lawyer Ronald Riccio says Peter Madoff should also be held responsible because he was the chief compliance officer at his brother’s firm.

Nadel’s bail set, freedom unlikely for swindler

Accused fraudulent hedge fund manager Arthur Nadel is unlikely to see freedom ever again.

A judge in a New York federal court set Nadel’s bail at $5 million, requiring at least $1 million be posted in cash, and that he have four other people guarantee his bond.

Nadel is accused of defrauding investors in several hedge funds out of more than $300 million when later investigations revealed Nadel and his funds were worth less than $125,000.

Nadel’s attorney estimates that his client does not have the money, and doesn’t know enough well-to-do people to guarantee his bond. That means the corrupt investor will have to sit in jail until he faces securities and wire fraud charges.

The judge in the case, according to Bloomberg, said Nadel defrauded investors over a long period of time and faces “near certain” prison time. At 76, most feel Nadel will spend the rest of his life in prison, but few – including the judge – are feeling sympathetic.

Madoff Victim’s Lawsuit Dismissed

An investor who entrusted $10 million to Bernard Madoff days before his arrest won’t be able to jump ahead of other investors to access his money.

Instead, Martin Rosenman’s case has been dismissed.

The judge indicated he believed Mr. Rosenman was “indistinguishable” from other victims of the Madoff scheme, but just that his timing was unfortunate.

However, the judge did not dismiss a lawsuit brought by Hadleigh Holdings, which claims it entrusted $1 million to the Madoff firm three days before his arrest.

Nadel gets bail decision Wednesday, partners want some assets unfrozen

Accused fraudulent hedge fund manager Arthur Nadel will find out Wednesday morning if he’ll receive bail and be released from a New York jail.

As he sits in custody, partners of his are petitioning a judge to have jewelry they’re trying to sell unfrozen. The partners claim the transaction would be a legitimate transaction, and not a way to stash assets as the government claims what they can of Nadel’s property and cash.

Nadel is accused of defrauding investors out of more than $330 million before he vanished from Sarasota, Fla., on Jan. 14. He re-surfaced two weeks later, surrendering to authorities.

Now, as those who invested with Nadel seek to recoup their losses, the federal government is trying to seize what they can.

Nadel faces the rest of his life in prison if he’s found guilty on the securities and wire fraud charges against him.

Madoff Could Not Have Acted Alone, says Examiner

The finding that Bernard Madoff didn’t trade any securities for more than a decade may show that the money manager couldn’t have acted alone.

Trustee Irving Picard said he found no trace of stock trades on their behalf by Bernard L. Madoff Investment Securities LLC for as much as 13 years.

James Ratley, president of the Association of Certified Fraud Examiners, says that a Ponzi scheme of this magnitude would require daily monitoring by more than one person.

Madoff’s lawyer, Ira Sorkin, declined to comment on whether Madoff had help in the alleged scheme.

If convicted, Madoff faces as much as 20 years in prison and a $5 million fine.

Madoff Trades Were Pure Fiction

Investigators have confirmed suspicions that the monthly statements, showing that Bernard Madoff was making stock trades for investors, were pure fiction.

Court-appointed trustee Irving Picard Picard is overseeing the liquidation of Bernard L. Madoff Investment Securities LLC.

So far he has recovered an estimated $950 million in assets that would be used to help cover claims likely to reach into the billions.

About 2,400 people have filed claims. The total is expected to rise sharply before the July 2 deadline.

Red flags missed in Stanford fraud case

Apparently they don’t make red flags like they used to as more and more were missed, and could have stopped alleged securities fraud mastermind Robert Allen Stanford years ago.

According to an Associated Press report, the Securities and Exchange Commission had been tracking Stanford and his corrupt The Standford Group for a number of years. Charges against the billionaire weren’t filed until last week and not until several other similar schemes had been hatched and discovered.

Stanford used a bank in Antigua to hide most of his activities. The bank went virtually unregulated.

But according to the AP report, if other warning signs had been further investigated, he could have been stopped long ago.

In 2007 Stanford settled National Assoc. of Securities Dealers’ charges against his company without admitting any fault or wrongdoing.

Stanford never received more than a fine even after several SEC investigations. A former employee accused Stanford of running a Ponzi scheme in 2006, and two more in 2008 accused the Antigua bank of selling CDs at inflated rates.

There are at least five more major warning signs that Stanford was indeed corrupt, but all went virtually unnoticed.

R. Allen Stanford Found by FBI

FBI agents have found R. Allen Stanford, the suspected mastermind of a $9.2 billion financial fraud, in Fredericksburg, Va., and served him with court papers.

The SEC charged Stanford after determining that he was allegedly misleading customers in the sale of certificates of deposit and other financial products.

The SEC also charged Stanford’s three companies and two associates with fraud.

The bank at the center of the alleged fraud is based in Antigua.