SEC notes the rise of 'Affinity Fraud', with South Florida as the hotbed

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‘Ponzi-like’ scheme scammed immigrants, feds say. South Florida a hotbed of ‘affinity fraud’​

June 30, 2023
It seemed like a preposterous investment opportunity, promising returns of 12.5% to 325% throughout the coronavirus pandemic.

But some 1,500 investors — mostly Haitian Americans in South Florida and others from Haiti, Canada and India — fell for the Broward County trucking company’s too-good-to-be-true sales pitch, U.S. authorities say.

The investors will now be lucky to recover dimes on the dollar, according to authorities. Federal authorities recently filed a criminal indictment and a civil complaint against the Coral Springs owner, Sanjay Singh, and his company, Royal Bengal Logistics Inc., alleging a conspiracy to raise $112 million from investors by using new ones to pay off old ones in a “Ponzi-like” scheme involving fraudulent wire transfers and securities violations.

In court papers, Singh, 43, is accused of misappropriating at least $14 million from investors for himself and diverting another $19 million of their funds into personal brokerage accounts that lost money. He was granted a $1 million bond after his arrest last week, and is scheduled for arraignment in Fort Lauderdale federal court Friday on conspiracy and wire fraud charges. Singh could not be reached for comment, and his criminal defense lawyers did not return phone and email messages for comment.

In a separate Securities and Exchange Commission civil complaint, Singh and his company are accused of fraudulently raising money from investors through unregistered securities and related violations.

‘Affinity fraud’ cons target immigrants​

For decades, South Florida has been known as the nation’s con capital for its healthcare, income-tax and credit-card scams — not to mention high-end Ponzi schemes orchestrated by such notorious figures as Wall Street financier Bernard Madoff and Fort Lauderdale Scott Rothstein.

But the region has also become home to “affinity fraud,” authorities say, where investment schemers prey on unsuspecting immigrants and other minorities who tend to trust the perpetrators because they either know them or someone else who vouches for them. The Haitian American community has been hit particularly hard, but so have immigrants from Cuba, Colombia and Venezuela. Even the African-American and LGBTQ communities have been targets of affinity fraud.

“People automatically assume that because they are part of your community, whether it be a church, school or business, that it gives them an air of legitimacy,” said Eric Bustillo, director of the Securities and Exchange Commission’s Miami Regional Office. “They pull on these heritage strings that make investors want to invest with them.”

The SEC’s Miami office, through its Fraud Against Minority Groups Initiative, has become more vigilant about educating immigrant communities and others about affinity fraud and financial literacy over the past year. Nationwide, the SEC regularly issues an Investor Alert to warn immigrant communities in Florida, New York and other big states that they “should avoid investment decisions based solely on common ties with someone recommending or selling the investment.” The agency, which was formed during the Great Depression to regulate the securities industry, also conducts educational courses at schools, churches and other locations to inform immigrants about the perils of “affinity” investments.

“Just because someone is from your backyard, that doesn’t mean they’re offering you something that is not a fraudulent investment,” Bustillo told the Miami Herald. “You should still do your due diligence, your research, ask about the product, ask about the investment, ask if the investment broker is registered with the SEC, and ask if the product is registered with the SEC.”

“As the old adage goes, if it looks too good to be true, it probably is,” he added.

A string of fraud cases​

While the SEC’s latest affinity-fraud case stands out for the size of the alleged Ponzi-like scheme and number of investors, the agency has pursued about a dozen similar enforcement actions over the past decade.

A year ago, for example, a Miami payday loan business was ordered to pay more than $39 million to hundreds of Venezuelan Americans in South Florida who lost a chunk of their money after investing in the company, according to a federal judge’s order. Sky Group USA, LLC, agreed to the final judgment with the Securities and Exchange Commission without admitting or denying violations of federal laws. Under similar settlement terms, Efrain Betancourt Jr., the CEO of Sky Group, also agreed to pay more than $6 million towards the total penalty. Betancourt, however, was not charged criminally.

Allegations of misleading investors​

In Singh’s case, he is accused of conspiring with other employees, including Haitian Americans, at Royal Bengal to offer high-yield investments, promising investors that he would use their money to expand operations and increase the company’s purported fleet of 200 semi-trucks and trailers. Singh assured investors that his company was generating $650,000 to $1 million a month in revenue between 2019 and 2023 — and that their investments were safe and growing in value, according to court records

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CEO Of Cryptocurrency And Forex Trading Platform Sentenced To Nine Years In Prison For $240 Million Scheme To Defraud Investors​

July 18, 2023

Damian Williams, the United States Attorney for the Southern District of New York, announced today that EDDY ALEXANDRE was sentenced by U.S. District Judge John P. Cronan to nine years in prison for engaging in commodities fraud. ALEXANDRE was the leader of a purported cryptocurrency and foreign exchange (“forex”) trading platform called EminiFX, and he defrauded over 25,000 investors in the EminiFX trading platform of more than $248 million.

U.S. Attorney Damian Williams said: “Eddy Alexandre defrauded tens of thousands of ordinary investors of almost a quarter-billion dollars in his cryptocurrency investment scam. Alexandre’s fraud was brazen and included fabricating weekly investment returns of at least 5% out of thin air and falsely claiming to use artificial intelligence trading technology that did not even exist. Most egregiously, Alexandre recruited many of his investors by exploiting his position of trust within his church and the Haitian community, even going so far as to enlist members of the church to help recruit EminiFX investors. As today’s sentence demonstrates, cryptocurrency executives who lie and cheat their customers will be held to account for their crimes.”

In addition to his prison term, ALEXANDRE, 51, of Valley Stream, New York, was sentenced to three years of supervised release and ordered to pay forfeiture in the amount of $248,829,276.73 and restitution in the amount of $213,639,133.53.

 

[Professor Emeritus]

looking at different articles:

On doing a domain names search on EminiFX.com, it was revealed that this domain was privately registered on 25th November 2021.

EminiFX CEO Eddy Alexandre was first arrested in May 2022

he defrauded over 25,000 investors in the EminiFX trading platform of more than $248 million.

Am I missing something, or did he pull off a $250 million fraud in his first six months?

 

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Texas OAG Secures $10.76 Million Judgment Against Pyramid Scheme Operators Who Exploited Consumers During Covid-19 Pandemic

The Office of the Attorney General (“OAG”) secured a $10.76 million Final Judgment and Permanent Injunction against BINT Operations LLC (“Blessings in No Time”) and its owners, LaShonda and Marlon Moore of Frisco, Texas, for the perpetration of an illegal pyramid scheme.

www.texasattorneygeneral.gov

Prosper DJ, wife ordered to pay $10.7 million for pyramid scheme targeting Black investors​

The Texas attorney general said nearly 8,000 consumers were scammed in Texas and across the country.​

DJ ASAP ("Always Serve A Purpose”) aka Marlon Moore (left) and his wife, LaShonda, are being sued for operating an alleged pyramid scheme called “Blessings in No Time.”
Jul 26, 2023

The Prosper DJ and his wife who orchestrated a “blessing loom” pyramid scheme that targeted the Black community have been ordered to pay $10.76 million and will be banned from operating multilevel marketing operations.
The Texas attorney general’s office said there was a final judgment and permanent injunction issued in the civil case against Prosper DJ ASAP, a.k.a. Marlon Moore, and his wife, LaShonda Moore, for operating an illegal pyramid scheme that promised Black investors returns up to eight times their initial investment.
Their “faith-based wealth-building organization,” BINT Operations LLC, which stands for Blessings in No Time, scammed consumers, many of whom were Black or struggled financially during the pandemic, of millions, government investigators said. The Federal Trade Commission and the state of Arkansas were also involved in the enforcement actions that permanently ban the couple from multilevel marketing, ban them from operating a chain referral scheme and ban them from making deceptive or unsubstantiated income claims or misrepresentations

This type of scam is described by investigators as a gifting circle, a blessing loom or an illegal take on a sou-sou, or informal savings club. In Texas, those who operate pyramid schemes can face up to two years in state jail and a fine of up to $10,000. Reports of multilevel marketing companies and pyramid schemes on social media increased fivefold in the later half of 2020, the FTC says.

Defendants were ordered to pay up to $2.5 million and a minimum of $450,000, for a Texas-administered fund to assist victims of the pyramid scheme.

 

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July 27, 2023

SEC.gov | SEC Charges Florida Resident with Operating $35 Million Ponzi Scheme that Targeted Church Members

www.sec.gov

 

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SEC Charges Florida Resident with Operating a $1.8 Million Ponzi Scheme Targeting Haitian American Community​

Sept 19, 2023

The Securities and Exchange Commission today charged MFB 111 Investment, LLC and its president, Monise François Bien Aimé, alleging that they fraudulently raised approximately $1,800,000 from at least 170 investors through an unregistered securities offering, targeting members of the Haitian and Haitian American community in South Florida and elsewhere.

The SEC's complaint alleges that from at least 2021 to 2022, MFB and François offered investment contracts to investors promising returns of up to 10% on a weekly, and later monthly, basis. MFB and François promoted the scheme through Facebook videos and word-of-mouth within South Florida's Haitian community. As alleged, MFB and François made statements to investors claiming the investment was safe and that investor funds would be used to purchase real estate for short-term Airbnb rentals, invest in mutual funds, a restaurant, a gas station, and to buy merchandise for François' clothing store. In fact, as the SEC alleges, while MFB and François made some investments, they also misappropriated at least $186,000 of investor funds, used investor funds to make Ponzi-like distributions to investors, and ultimately failed to repay most investors the principal and interest promised.

The SEC's complaint, filed in U.S. District Court for the Southern District of Florida, charges MFB and François with violating the registration provisions of Section 5 of the Securities Act of 1933 (Securities Act). The complaint also charges MFB and François with violating the antifraud provisions of Section 17(a) of the Securities Act and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The SEC seeks permanent injunctive relief, disgorgement of allegedly ill-gotten gains plus prejudgment interest, and civil penalties against MFB and François, and an officer and director bar against François. The complaint names Julien Janvier, a Miami area gospel singer who received investor proceeds, as a relief defendant and seeks disgorgement with prejudgment interest from him.

 

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SEC Charges California Resident with Multimillion Dollar Ponzi Scheme Targeting Tongan American Community​

Sept. 19, 2023
The Securities and Exchange Commission today charged Richmond, California resident Tilila Walker Sumchai with raising approximately $11.8 million from more than 1,000 investors through a fraudulent securities offering targeting members of the Tongan American community across the United States.

According to the SEC’s complaint, from approximately January 2021 through October 2021, Sumchai convinced retail investors to acquire shares of an investment she created called “Tongi Tupe” by falsely claiming that she would use a secret algorithm to generate guaranteed high returns. The complaint alleges that Sumchai first targeted respected Tongan American leaders, who were paid substantial returns on their investments, which convinced many of the leaders to believe that Tongi Tupe was legitimate. Sumchai then organized meetings hosted by these leaders at which Sumchai promoted Tongi Tupe to other members of the Tongan American community. As alleged, Sumchai promised exceedingly high returns, including a $146,000 return in 16 weeks on a $3,000 investment. In reality, the complaint alleges, Tongi Tupe did not generate any returns; instead, Sumchai operated a Ponzi scheme that relied on new investor money to pay earlier investors. Additionally, as alleged in the complaint, Sumchai used investor money for unauthorized and undisclosed purposes, including to pay for casino trips, travel, and shopping.

“As we allege in our complaint, Sumchai sought to enrich herself by exploiting retail investors within the Tongan American community,” said Monique C. Winkler, Director of the SEC’s San Francisco Regional Office. “The SEC will continue to aggressively pursue affinity frauds, which prey on the trust that members of a close-knit community have in each other.”
The SEC’s complaint, filed in U.S. District Court for the Eastern District of California, charges Sumchai with violating the antifraud provisions of the federal securities laws. The SEC seeks permanent injunctions, including a conduct-based injunction, disgorgement with prejudgment interest, a civil penalty, and an officer and director bar

 

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Man is accused of scamming fellow Haitian-Americans as part of an investment scheme in South Florida​

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Posted on January 10, 2024


MIAMI – Anson Jean-Pierre promised his fellow Haitian-Americans that not only would they become “millionaires” if they invested with him, but that the hundreds of thousands of dollars they would eventually pour into his company would develop businesses in Haiti, he claims the authorities.
But according to investigators, none of this was true.

Instead, they say Jean-Pierre spent some of the money on things like Caribbean vacations, hotels, restaurants, plane tickets and groceries – on himself. Authorities claim he didn’t spend a dime on promised projects.
The 61-year-old, who was already at the center of a US Securities and Exchange Commission lawsuit over “affinity fraud” against his fellow Haitians, now faces state criminal charges.
Authorities on Tuesday booked Jean-Pierre into the Turner Guilford Knight Correctional Center in Miami-Dade County on a litany of racketeering, money laundering, organized fraud and securities fraud charges. He is charged along with 50-year-old Edy Durosier.

Florida Department of Financial Regulation investigators allege in an arrest warrant that Jean-Pierre defrauded investors of nearly $700,000 from 2017 to 2019.
He is said to have run a company called Brothers Investment Group International, LLC in North Miami Beach, a city with a large Haitian-American population.
Durosier is accused of running Fort Lauderdale-based Advantage Realty & Investment Group. Authorities said he falsely claimed to be a lawyer and a law professor at St. Thomas University.
The couple held meetings in South Florida and promised investments in real estate and agriculture in Haiti, an arrest warrant says. Durosier is accused of telling investors that he had developed a “renewable energy device” that would provide solar power and internet service to the impoverished Caribbean nation.

According to authorities, Brothers International also sold fake “foreign diplomat courses” for $600 and promised investors that after paying and completing the course, they would be “recognized as high-ranking officials (of the company) with special privileges if they were to enter the country.” Travel abroad.” ”
Durosier told investors in the Brothers’ Real Estate Group that he would apply for credit cards on their behalf and receive cash advances that would then be used to “buy and sell” homes in Miami-Dade County, authorities said.
The arrest warrant states that Jean-Pierre “did not invest in a single revenue-generating project, but continually told investors that their money was in the bank, when in fact he had already spent it.”
The only thing resembling an investment by Brothers was $60,000 transferred to BurgerIM Group USA, Inc. as a down payment for a burger franchise, authorities allege, but “(n)one of the investors gave money for the.” Investing in a burger franchise.”

This money was later returned to Brothers. In addition to Jean-Pierre’s personal expenses, authorities say Brothers spent $200,000 in “consulting fees” on projects without informing investors.
Authorities said Jean-Pierre paid some investors about $21,000 – to suppress complaints about Brothers Investment.
According to jail records, Jean-Pierre, who has been charged with more than 40 crimes, was being held Wednesday afternoon at the Turner Guilford Knight Correctional Center in Miami-Dade on $730,000 bail.
Although Durosier faces similar charges, he is not yet listed in court or jail records in Miami-Dade or Broward. It is not yet clear whether he has been found

 

[Kingcobrakai]

This country is broken to the point where it mimics Eastern European countries with lax regulation, people being priced out of stability until they look for any edge to get rich, and people not being rational/educated enough to recognize a scam from the beginning.

 

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Defendant Convicted of Fraudulent Scheme That Targeted the Haitian American Community Sentenced to 24 Months in Prison

Earlier today, at the federal courthouse in Brooklyn, Frantz Simeon was sentenced by United States District Judge Brian M. Cogan to 24 months in prison for his operation of a fraudulent scheme that used his company, First Black Enterprises, Inc., to target members of the Haitian American...

www.justice.gov

Mar 1, 2024
Earlier today, at the federal courthouse in Brooklyn, Frantz Simeon was sentenced by United States District Judge Brian M. Cogan to 24 months in prison for his operation of a fraudulent scheme that used his company, First Black Enterprises, Inc., to target members of the Haitian American community in Brooklyn and Queens. As part of the sentence, Simeon was ordered to pay over $200,000 in restitution. The defendant pleaded guilty to mail fraud in February 2023

Between February 2019 and December 2020, Simeon orchestrated a fraudulent scheme in which he falsely advertised his business experience and acumen, enticing investors to invest with him based on promises that their investments were risk-free and would generate 10% monthly returns. Simeon specifically preyed on Haitian Americans residing in Brooklyn and Queens, leveraging his relationships in the community to induce over $350,000 in investments with his false assurances. Contrary to his promises, Simeon conducted little or no actual business or investment activities, instead using the money from new investors to mail monthly interest payments to them and earlier investors in a Ponzi-like scheme. These purported interest payments were designed to conceal the fraud and to induce further investments, which Simeon needed to continue the scheme. In addition, Simeon misappropriated thousands of dollars of investor funds for his own personal benefit, including the purchase of a car for his daughter and making over $60,000 in cash withdrawals. Simeon’s victims, who were largely immigrants, ultimately sustained over $200,000 in losses as a result of the scheme.

 

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May 7, 2024

South Florida Haitian-Americans say they invested money to become part of local trucking company but didn’t receive payout - WSVN 7News | Miami News, Weather, Sports | Fort Lauderdale

(WSVN) - State and federal investigators are looking into a South Florida company that held recruiting events in the Haitian community after people complained they<a class="excerpt-read-more"...

wsvn.com

 

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The crooks, 4 years ago

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Attorney General James Sues Cryptocurrency Companies NovaTechFx and AWS Mining for Defrauding Investors of More Than $1 Billion​

NovaTechFx and AWS Mining​

June 6, 2024​

NEW YORK – New York Attorney General Letitia James today sued cryptocurrency trading company NovaTechFx (NovaTech), its founders Cynthia and Eddy Petion, and cryptocurrency mining company AWS Mining Pty Ltd. (AWS Mining), for engaging in illegal pyramid schemes that defrauded hundreds of thousands of investors, including over 11,000 New Yorkers, of over a billion dollars’ worth of cryptocurrency.

The lawsuit alleges that the companies targeted immigrant communities, particularly Haitian New Yorkers, in prayer groups and through social media and WhatsApp group chats with fraudulent promises of high returns on investments, but never actually made the promised profits. An investigation by the Office of the Attorney General (OAG) found that from 2019 to 2023, investors deposited over one billion dollars’ worth of cryptocurrency in NovaTech but only a fraction, less than $26 million, was actually traded on NovaTech’s cryptocurrency trading platform.

Attorney General James seeks to ban AWS Mining, NovaTech, and its founders from doing business in New York and to secure disgorgement and damages.

 

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SEC.gov | Marc Henry Menard; Laesha Jean-Louis

www.sec.gov

U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26019 / June 11, 2024​

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Securities and Exchange Commission v. Marc Henry Menard, No. 24-cv-4149 (E.D.N.Y. filed June 11, 2024)​

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SEC Charges Individual in Fraudulent Investment Scheme Targeting the Haitian-American Community​

The Securities and Exchange Commission today announced that it filed charges against Marc Henry Menard in the Eastern District of New York for allegedly defrauding more than fifty individuals, many from the Haitian-American community, of at least $1.65 million.

According to the SEC’s complaint, from approximately July 2021 through September 2023, Menard solicited investments by misrepresenting his past investment success, how he would use investor funds, and the returns investors would receive. The complaint alleges that Menard told a number of investors that their funds would be used to trade in stocks and options, and that Menard purportedly guaranteed interest payments of 10 to 20 percent per month. As alleged in the complaint, Menard was not the successful investor he claimed to be, losing nearly $700,000 trading securities, primarily using investors’ funds. As further alleged in the complaint, Menard misappropriated a significant amount of investor money for his personal use by spending hundreds of thousands of dollars on luxury vehicles, international travel, gifts, rent, and other personal expenses, as well as to make payments to prior investors in a Ponzi-like manner. In addition, as alleged in the complaint, Menard diverted significant amounts of investor money to Laesha Jean-Louis, with whom he had a romantic relationship. Finally, the complaint alleges that when Menard could no longer make promised interest payments to investors or repay the principal on their investments, Menard resorted to additional falsehoods to conceal his scheme.

The SEC’s complaint, filed in the U.S. District Court for the Eastern District of New York, charges Menard with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1), 206(2), and 206(4) of the Investment Advisers Act of 1940 and Rule 206(4)-8 thereunder, and seeks permanent injunctive relief, disgorgement plus prejudgment interest, civil penalties, and a bar from acting as an officer or director of any public company. The complaint also names Jean-Louis as a relief defendant and seeks disgorgement plus prejudgment interest