New York Exec Nailed for Alleged $400 Million Ponzi Scheme
Tuesday, January 27, 2009 : PermalinkNew York (HedgeCo.Net) – Nicholas Cosmo, head of New York-based Agape World Inc., has been arrested for allegedly running a $400 million Ponzi scheme. His company, which marketed commercial bridge loans, was not registered with the U.S. Securities and Exchange Commission.
“Some of the early investors made money but as this scheme started to crumble, the later investors did not see a penny,” said one law enforcement official, referring to the classic Ponzi scheme, where new money coming in is used to pay off earlier investors.
Agape World Inc. had bragged to clients that they posted consistent returns of around 14 percent. Had investors performed a due diligence on Cosmo, they would’ve found that he was convicted in 1999 of fraud and sentenced to 21 months in prison.
Agape World Inc. was essentially aiming to be an asset based lender. They supposedly provided project loans on construction, acquisition loans and provided financing for unfinished properties.
The trouble in the markets lately has highlighted the immense presence of Ponzi schemes all around the country. Even after the $50 billion Madoff debacle, a handful of Ponzi schemes and fraudsters have floated to the surface. Arthur Nadel of Sarasota, Florida, disappeared along with his client’s $350 million in cash. Shortly after, Michael Riolo of Boca Raton was targeted, accused of bilking $50 billion out of investors.
Julie Scuderi
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21 months, accredited-investors, boca raton, bridge loans, commercial bridge, consistent returns, cosmo, due diligence, fraudsters, hedgeco, immense presence, new-money, ponzi scheme, ponzi schemes, project loans, riolo, sarasota florida, securities-and-exchange-commission