Alpharetta, Ga businessman James G. Ossie has been charged with 10 counts of wire fraud related to a ponzi scheme he allegedly set up. A federal grand jury unsealed the indictment on Wednesday and Ossie is supposed to surrender himself in federal court on Friday.

“This indictment alleges yet another disturbing Ponzi scheme with a similar result: many victims lose a lot of their hard-earned money in a short amount of time,” U.S. Attorney David E. Nahmias said in a statement.

CRE Capital was founded by Ossie as a currency trading program which proported unbelievable returns of 10% every 30 days or an annual rate of 120% on an investment. The SEC shut CRE Capital down in January stating CRE capital and Ossie had fraudulently obtained at least $25 million from investors during 2008.

The SEC’s complaint alleges violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. In addition to emergency relief, the Commission’s complaint seeks disgorgement of the defendants’ ill-gotten gains plus prejudgment interest and financial penalties.

CRE Capital offered investments in minimal amount of $100,000 and guaranteed the return of the initial deposit plus 10 percent interest within 30 days. Ossie claimed to be able to pay such substantial monthly returns because he typically made even more than that through his Forex currency trading activity.

Ossie told lawyers that CRE Capital hired outside auditors to review and confirm the accuracy of his numbers. The indictment also alleged that although CRE may have hired outside accountants for some projects, Ossie did not complete allow any access to the records of the trading accounts that would have revealed his substantial losses.

Each year, millions of people are the victim of Forex trading scams and ponzi schemes. The SEC has warned investors for years that if the return seems too good to be true, it it probably is.

Bail was revoked today for Bernie Madoff, the man behind the largest ponzi scheme in American history. Madoff appeared earlier before U.S. District Judge Denny Chin in Manhattan to plead guilty to directing the largest Ponzi scheme in history.

Bloomberg reported :

Madoff is pleading guilty to 11 counts including securities fraud, wire fraud, and money laundering. Madoff doesn’t have a plea deal with prosecutors because he refused to admit to a conspiracy charge that would have required he implicate others, people familiar with the case said. As a result he must plead guilty to all charges.

Source : http://www.bloomberg.com

Madoff confessed to Chin that in the early 1990s when the United States was in a recession, he felt “compelled’” to provide the kind of returns he promised his investors. He said when the Securities and Exchange Commission asked about it and he simply lied to the SEC.

Madoff’s guilty plea which was repeated 11 times today emphasizes the downfall of a highly acclaimed money manager who told the world his fortune came from a successful firm that specialized in making markets, trading securities and financially advising wealthy clients.

Official sentencing is set for June 16th. The 70yo Bernie Madoff will likely spend the rest of his life in some form of incarceration. It is believed that his sentence will be over 25 years which will mandate Madoff spend his time in maximum security facilities and not a minimum security “country club” setting. Fox News reported that Madoff may even have to be locked up 23 hours per day to prevent attacks from other inmates seeking to make a name for themselves on the prison block by taking out a high profile prisoner like Bernie Madoff.

The poor economy has many people taking drastic measures to put food on the table for their family. One texas man, who was recently laid off has decided to auction his family on eBay to make ends meet.
From the auction text :

We are a family of five living in the suburbs of Austin, TX. We own our house, are college educated, good standing members of the PTA, YMCA, and active members of our church. We believe in STRONG family values and cherish our commitment to each other. We are seeking ‘Sponsorship’ by a corporate brand looking for a unique way to target the American consumer. Let us represent your brand and be your cross cultural appeal Brand Ambassadors/Evangelists!! We would represent your brand in the following: * Public family oriented events including: o Home & Garden Shows o Festivals o City wide parades and PR o Speaking Engagements o Sporting Events * Clothe us in your branded wears * Wrap our two well kept cars with company branded advertisements * Feature us in a national print ad and signage as “The All American Family” that uses your brand * Feature us in a regional commercial as “The All American Family” that lives by your brand * Infomercial possibilities * Post a sign in our yard as ‘The Home’ run by your brand

Don’t believe it? See for yourself : A family of four for sale on eBay

You don’t need to be embarassed about not having a credit card to make online purchases, register a Paypal account, rent a car, make hotel reservations, pay bills online and so many other things that require the use of a Visa or MasterCard.

The Account Now Visa can be used anywhere the Visa logo is accepted. You can use it at a restaurant, at an ATM, at the grocrey store and millions of other locations where Visa is accepted. If you are having credit problems and cannot open up a checking account, the Account Now Visa works as a virtual banking account that provides direct deposit.

If you’re on a limited budget, the Account Now Visa is better than a traditional checking account because the card offers free direct deposit so you won’t have to deal with expensive check cashing fees to cash your paycheck. There are no Credit history checks or ChexSystems verification. There are no hidden security fees. You also get free online bill pay for up to seven transactions a month.

Demonstrate your credit worthiness when applying for housing, credit, insurance, employment, and phone. Every time you make a bill payment with AccountNow Bill Pay, we will send your bill payment information to PRBC, a national credit reporting agency. It’s FREE when you activate AccountNow Bill Pay!

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While downturns in the economy might force ethical lenders to become more careful about extending lines of credit, the opposite is true of predatory lenders who prey upon consumers in difficult circumstances. It may seem that creditors are not writing new loans or opening new lines of credit for consumers with good credit scores and that is generally true in a poor economy. Creditors would much rather stake a higher risk consumer and charge them considerably higher interest rates. This makes it possible for the creditor to earn a greater return in a shorter period of time regardless of the fact the higher risk consumer will probably end up defaulting somewhere down the line.

Predatory lenders often pile up mountains of consumer debt and then sell that debt to other banks and lenders who have experienced collections departments or who employ in-house collection agencies to go after debtors. If the collection attempts fail, those bad loans can be deducted as operational business losses by the creditor and written off as an ordinary loss less 10%.

Companies like Capital One and HSBC are at the top of the list because they issue high interest rate cards to anyone who will sign on the dotted line and charge them ridiculous interest rates and fees. When the cardholders default on the loans, the issuiing banks who traditionally took the damage as a tax write-off, are now strapped for cash and lack sufficient equity to leverage more consumers into their trap.

If you are wondering how this scenario could possibly be profitable, it is in the short term but in the long run, this strategy is fatalistic, as we are seeing with the recent collapse of the lending industry which has required federal bailouts. This doesn’t mean that these lenders who started the mess with their unethical tactics are going to close up shop and run away, in fact, it means the opposite. Expect more and more high risk lines of credit to be opened by people with poor credit histories and more predatory lenders targeting these high risk consumers because the American taxpayer will foot the bill in the end.

Tagged: poor economy, predatory lender, creditors

Beware of a new scam that is using the iKobo.com’s name to try and get your personal information. iKobo is a “person to person” money transfer agent or payment processor much like Paypal and they do not send unsolicited emails such as this one asking for you to send information back to them.

Here’s a copy of the phishing email…

Our Ref: IKG/NGN/ICO Your Ref: Dear Beneficiary, iKobo is a company that specializes in money transfers. With them, you send money to the any countries with your MasterCard or Visa. The recipient gets your transfer put onto a secured Visa debit card which can be used worldwide at ATM locations for cash withdrawals. This debit card, which is reusable, is shipped to the recipient first. As part of our commitment in bringing our services to the world to the world, I wish to announce to you that your email emerged as one of the luck winners to receive a grant of 2.8 Million US Dollars. This fund would be made available to you through your an iKobo Visa card. Your Personal identification Number is 2222. Name On Card: iKobo Beneficiary iKobo Visa Card Number: 4147202034772580 Expire: 01/2010 Cvv Number: 369 We have concluded plans to deliver this card to your as soon as possible. You are to send us the following details: FULL NAME: DELIVERY ADDRESS: PHONE NUMBER COUNTRY: OCCUPATION: MARITAL STATUS: SEX: AGE: We look forward to hearing from you soon. Copyright © 2001-2008 iKobo, Inc. https://www.ikobo.com

Chances are, if you send the minimal required information, these scammers will have somebody contact you and ask for further information or possibly for you to make a deposit in order to claim the supposed grant of 2.8 Million. This is a classic scam where the con artists will try to win your trust until they can get what they want from you.

There are several clues to this email being a scam located in the email headers. To begin with, the email was relayed through a hosting account on siteground.com for the domain wshf.org using the email client “SquirrelMail/1.4.13″ and email account (nochumson@wshf.org) which is possibly forging the email address of somebody named Howard Nochumson, who is listed as the administrative contact for the “Washington Square Health Foundation”, the legit owner of the wshf.org domain. The IP the email originated from (80.255.62.236) seems to have quite a history of spamming and appears to be some sort of satellite service operated by Intelsat Global Service Corporation (intelsat.com) who has a Washington, DC address in their contact information, yet is listing an Atlanta, Georgia (404) area code in their abuse contact information.

Nowhere is there any record of the email being sent from, nor relayed through iKobo’s mail servers, although it is quite strange this type 419 Phishing scheme is usually routed through Nigeria, it’s odd to see all the corresponding IP’s pointing to US locations only.

Nevertheless, do not ever respond to emails such as this which claim you have won a large sum of money and the decision as based on your email address selection alone. These type of emails are always 100% guaranteed scams.