Affinity Fraud Ponzi Scheme
Published On: October 20, 2022

Stoltmann Law Offices represents victims of investment fraud where financial advisors have robbed their clients through Ponzi schemes, often targeting vulnerable communities. The U.S. Securities and Exchange Commission (SEC) has charged Miami-Dade County resident Judith Paris-Pinder, alleging that she ”fraudulently raised approximately $2.3 million from over 280 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 2019 to 2021, “Pinder offered loan agreements to investors promising returns of up to 50%, within 30 to 90 days. As alleged, Pinder made statements to investors claiming the investment was safe and that investor funds would be used to make advance loans to personal injury clients of a prominent Miami-based attorney. In fact, as the SEC alleges, Pinder, misappropriated investor funds and used investor funds to make Ponzi-like distributions to investors.”

The SEC’s complaint also charges Pinder 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. The SEC “seeks permanent injunctive relief, an officer-and-director bar, disgorgement of allegedly ill-gotten gains plus prejudgment interest, and civil penalties against Pinder.

Pinder has consented to a settlement, subject to court approval, under which she will be barred from serving as an officer or director of any SEC-reporting company. Additionally, Pinder agrees that the court will determine whether it is appropriate to order her to pay disgorgement with prejudgment interest and a civil penalty.”

Like many Ponzi Schemes, the pitch to investors emphasized rapid, above-market returns, although investors’ money was never invested. Client funds were then pilfered by the broker or used to pay off initial investors.

According to the SEC, “Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. With little or no legitimate earnings, Ponzi schemes require a constant flow of money from new investors to continue. Ponzi schemes inevitably collapse, most often when it becomes difficult to recruit new investors or when a large number of investors ask for their funds to be returned.”

Starting in 2020, the SEC noticed an upsurge in Ponzi scams. “Fraudsters use times of uncertainty and change, such as the COVID-19 pandemic, to lure victims into investment scams. Most Ponzi schemes involve individuals or firms that are not licensed or registered. You should verify whether a seller is currently registered or licensed using the free and simple search tools on Investor.gov.”

If you invested with a financial advisor and lost money as a result, you may have a claim to pursue through FINRA Arbitration or litigation. Please contact Stoltmann Law Offices, P.C. at 312-332-4200 for a free, no obligation consultation with a securities attorney. Stoltmann Law Offices is a contingency fee law firm which means we do not get paid until you do!

Disclaimer

The posting on this site are mere OPINIONS and NOT statements of fact in any way whatsoever. The information should not be relied upon and there have been no findings made against the firms or individuals referenced on this site. In addition, this Blog is made available for educational purposes only and incorporates information from the web as well as to give you general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand that there is no attorney client relationship between you and Stoltmann Law Offices (161 N Clark Street 16th Floor Chicago, IL 60601). The Blog opinions should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.

PLEASE NOTE THIS IS ADVERTISING AND IT IS NOT A NEWSPAPER ARTICLE OR POST FROM AN INDEPENDENT OR NON-BIASED, NEWS SITE, NEWS SOURCE OR NEWSPAPER.

Chicago Investment Fraud Attorneys Offering Nationwide Representation to Investors

If you have suffered financial losses because of the negligence or fraud of your financial advisor or broker through unsuitable investment recommendations, over-concentration, churning, misrepresenting risks, conversion or selling away, you have legal rights and options to pursue recovery of those losses.

Stoltman Law Securities and Investment Fraud Attorneys