Two charged in $9M Ponzi scheme

The Attorney General's Corporate Oversight Division last week charged two west Michigan men for their alleged involvement in a $9 million Ponzi scheme, which operated under the name API Worldwide Holdings, LLC. The charges against Jeffry L. Ripley, 59, of Sparta, and Danny Lee VanLiere, 60, of Grand Rapids, result from a joint investigation by the Office of Financial and Insurance Regulation (OFIR) and the Department of Attorney General which revealed at least 140 victims who were allegedly defrauded of thousands of dollars.

''Financial scams devastate the lives of citizens who worked so hard to provide for their families,'' said Michigan Attorney General Bill Schuette. ''Crimes against the elderly are on the rise, and those who target Michigan seniors will face the toughest penalties under the law.''

It is alleged that from July 2006 through January 2012 API Worldwide Holdings and its operators ran as a Ponzi scheme promising huge returns on investments. Ripley and VanLiere allegedly defrauded at least 140 victims of approximately $9 million by selling fake securities. The two men allegedly promised high returns on money invested, but never delivered on their promises. The investigation revealed that victims were allegedly defrauded of amounts ranging from $3,000 to $600,000 each.

Schuette alleges that Ripley and VanLiere targeted elderly investors with their scam. Investigation revealed they allegedly preyed on elderly victims by convincing them to cash in certificates of deposit (CDs) and other legitimate investments in order to invest the proceeds in API Worldwide. It is alleged Ripley and VanLiere would track maturation dates of CD's for each victim, so they could make contact and persuade the victims to transfer the funds to API Worldwide immediately after the CD matured. None of the victims received any returns on their ''investments,'' and some even lost their life savings to the scam.

Schuette asks any citizens who believe they may be a victim of the alleged API Worldwide investment scam to contact the Attorney General's Corporate Oversight Division at (517) 373-1160.

Schuette encourages consumers to exercise caution before investing their money with those who promise exorbitant returns. Key tips to avoid falling victim to a Ponzi scheme or investment fraud include:

* Check out your broker or adviser. Confirm that your broker and financial adviser is registered and in good standing. Contact the Office of Financial and Insurance Regulation, at 1-877-999-6442, to check out your broker or adviser.

* Beware of strangers touting strange deals. Trusting strangers is a mistake anyone can make when it comes to their personal finances. Almost anyone can sound nice or honest on the telephone. Say ''no'' to any investment professional who presses you to make an immediate decision, giving you no opportunity to check out the salesperson, firm and the investment opportunity itself. Beware of anyone who suggests investing your money into something you don't understand or who urges that you leave everything in his or her hands.

* Take your time. Don't be rushed into investment decisions. Salespersons who use high-pressure tactics to force an investor into an immediate decision are almost always pitching frauds. They don't want you to think too carefully or find out too much because you may figure out that it's a scam.

* Keep tabs on your investments. Be wary when a financial planner says ''leave everything to me,'' or ''the plan is too complicated to tell you.'' Everything should be clear and explainable to you.

* Monitor the activity on your account. Insist on receiving regular statements.

* Ask questions. Never be embarrassed or apologetic about asking questions for trading activity that looks excessive or unauthorized. It's your money, not your broker's.

* Keep Diligent Records. Keep all of your records relating to your investments, including notes of conversations you have with brokers, salespeople, and financial advisers.

Published: Mon, Mar 19, 2012

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