Who believes that Daniel Spitzer was involved in a $105M Ponzi scheme throughout the Virgin Islands?”
The SEC is accusing a Virgin Islands money manager of running more than a $105 million Ponzi scheme. Daniel Spitzer, 51, used a complex series of accounts in foreign banks and brokerage accounts to move the money he got from about 400 investors, according to the SEC. Spitzer told investors he ran several funds which primarily invested in foreign currency. Investors received fraudulent statements depicting the funds as always turning a profit, the SEC alleged. Although Spitzer sometimes put investor money into investment vehicles, like mutual funds, they lost money or never made much and eventually were liquidated. But Spitzer kept paying off investors with new investor money, in true Ponzi fashion, according to government regulators. The SEC alleged that, although Spitzer’s scheme is on the verge of collapse, as recently as March, he got $100,000 from an investor which he used to pay other investors and his expenses. The regulatory agency obtained a court order freezing Spitzer’s funds
Washington, D.C., June 28, 2010 – The Securities and Exchange Commission today announced fraud charges and an emergency asset freeze against a purported fund manager based in the U.S. Virgin Islands who perpetrated a $105 million Ponzi scheme against investors. The SEC alleges that Daniel Spitzer, a resident of St. Thomas, used several entities and sales agents to misrepresent to investors that their money would be invested in investment funds that, in turn, would be invested primarily in foreign currency. Investors were falsely told that Spitzer’s funds had never lost money and historically produced profitable annual returns that one year reached over 180 percent. Spitzer instead used money raised from new investors to pay earlier investors, and misappropriated investor funds to pay unrelated business expenses. He concealed his scheme by issuing phony documents to investors that led them to believe their investments were profiting. The SEC has obtained an emergency court order freezin
A Virgin Islands-based financial manager ran a $105 million Ponzi scheme that defrauded 400 investors by falsely claiming to invest in foreign currencies, the U.S. Securities and Exchange Commission charged Monday. Daniel Spitzer, 51, invested only a fraction of the money he received from investors and channeled much of the rest into offshore bank accounts, the SEC said in a civil fraud complaint. It said he used the siphoned-off cash to pay off early investors to keep the scheme going as well as to provide himself with a lavish lifestyle that included spending nearly $1 million at a Las Vegas casino. The office of Spitzer’s Kenzie Financial Management Inc. office in St. Thomas recently closed down and the phone has been disconnected. It was not immediately known if Spitzer had an attorney, and a lawyer who represented him in a previous fraud case did not immediately return a phone call seeking comment.
