Nicholas Cosmo

Nicholas Cosmo (born 1971) is an American former businessman and white collar criminal. He was arrested January 26, 2009 on charges of an estimated $370–413 million Ponzi scheme.[1] Cosmo conducted the scheme using his company Agape World Inc. in Hauppauge, New York, which claimed to make its profits via commercial bridge lending.[2] Authorities arrested him in Hicksville, New York.

Cosmo was arraigned in Islip, New York on January 27, 2009 on charges of mail fraud.[3][4] Cosmo had previously been convicted of felony fraud in 1999, and had served his sentence of 21 months in prison for the offense.[3]

On October 14, 2011, Cosmo was sentenced to 25 years in prison.[5] It has been reported that his crimes represent the 8th largest financial fraud in history, since the first documented flimflam in 1719 involving Scotsman John Law.[6]

Agape World

Prosecutors stated that Nick Cosmo used $212,000 in Agape funds to pay restitution from the 1999 federal mail fraud conviction.[7]

Prosecuters were only able to trace $10 million of bridge loans that were made. $80 Million to $100 Million was allegedly lost in Commodities Future Trading and $55 to $63 Million of the investors funds went to pay the broker's commissions.[7][8]

The complaint against Agape World stated that many of the employees had criminal records.[9] Postal inspectors said Cosmo paid the brokers, some of whom were ex-convicts with records that included robbery and heroin importation, to recruit investors.[10]

One of the largest assets of Agape World was an indoor athletic complex purchased for $3.85 million. The complex was sold via auction in June 2009 to a company called Coastal Sports. Cosmo had purchased the 38,000-square-foot (3,500 m2) building in Hauppauge, New York for $3.85 million last year and spent another $1 million to transform the former paintball arena into indoor athletic fields.[11]

The building was the most valuable asset in Cosmo’s holdings liquidated by bankruptcy trustee, Silverman Acampora, and was auctioned off by David R. Maltz & Co. of Plainview, New York.[11]

Cosmo Post Bail

As of June 2009, Cosmo was unable to post bail. Judge Hurley would not release Cosmo until several conditions were met; Cosmo's relatives agreed to back a $1.25 million bail package secured by their homes and financial accounts.[12][13]

Cosmo, chief executive of a private suburban New York investment firm indicted for a $400 million fraud, was freed from jail on Thursday after it took months for him to make bail.

A U.S. judge released Cosmo on $1.25 million bail secured by property and frozen bank accounts but ruled he would be confined to his home under electronic monitoring on New York's Long Island.

Judge Revokes Cosmo’s Bail

In October 2009, a federal judge found that Cosmo couldn't be trusted and ended his house arrest after less than three months and returned him to jail to await trial.

U.S. District Judge Denis R. Hurley, at a hearing in Central Islip, New York, ordered that Cosmo be jailed pending trial after prosecutors alleged he used a computer and tried to transfer assets in violation of his bail conditions and provided false statements to a U.S. Pretrial Services officer.[14]

Cosmo Pleads Guilty to $413 million Ponzi Scheme

Cosmo plead guilty to mail and wire fraud charges on Friday 29 October, 2010, and faced up to 40 years in prison. On 14 October, 2011, he was sentenced to 25 years in jail. "Those who lie and steal from the investing public are on notice that they face severe penalties", U.S. Attorney Loretta Lynch in Brooklyn said today in a statement. "As recounted today in court by several of his victims, the defendant's actions crushed the hopes and dreams of everyday citizens".[5][15]

On April 25, 2012, a criminal complaint was unsealed in federal court in Central Islip, New York charging Jason Keryc, Anthony Massaro, Anthony Ciccone, and Diane Kaylor, former account representatives of Hauppauge, New York-based Agape World Inc. and Agape Merchant Advance (AMA), for their participation in a large-scale Ponzi scheme.[16]

SEC charges 14 Agape World Ponzi scheme brokers

The Securities and Exchange Commission has charged 14 former sales agents, including four pairs of siblings, for misleading investors while earning more than $52 million in commissions in the $400 million Agape World Ponzi scheme.

The SEC alleged the sales agents falsely promised investor returns as high as 12 - 14 percent, in several weeks when they sold investments offered by Hauppauge-based Agape World. They also misled investors to believe that only 1 percent of their principal was at risk. The Agape securities they peddled were actually non-existent, and investors were merely lured into a Ponzi scheme where earlier investors were paid with new investor funds, according to the SEC.[17]

References

  1. ↑ Gardiner, Sean (2009-04-16). "Feds Say Cosmo Ponzi Scheme Hits Estimated $413 Million With Foreign Investors, Bloomberg News (April 16, 2009)". Bloomberg.com. Retrieved 2012-04-29.
  2. ↑ Agape World website
  3. 1 2 "Financier Arrested on Charges of $400 Million Ponzi Scheme" Reuters via Yahoo News (January 27, 2009) Archived January 30, 2009 at the Wayback Machine
  4. ↑ "US Authorities Allege $380 Million Scheme, Bloomberg News via ''The Age'' (January 27, 2009)". Business.theage.com.au. Retrieved 2012-04-29.
  5. 1 2 "Mini-Madoff Gets 25 Years", Reuters via Yahoo News (October 15, 2011)
  6. ↑ http://www.savemoneytips.com/10-largest-ponzi-scheme-proprietors-of-the-21st-century/ 10 Largest financial fraud Proprietors of The 21st Century
  7. 1 2
  8. ↑ Hurtado, Patricia (2009-04-23). "Cosmo Indicted for Mail, Wire Fraud in Ponzi Scheme (Update2)". Bloomberg. Retrieved 2012-04-29.
  9. ↑ AllBusiness website entry
  10. ↑ Gardiner, Sean (2009-04-16). "Bloomberg News". Bloomberg.com. Retrieved 2012-04-29.
  11. 1 2 "Cosmos Field of Dreams Sold For 3.4M, ''Long Island Business News'' (June 4, 2009)". Libn.com. 2009-06-04. Retrieved 2012-04-29.
  12. ↑ "Accused Ponzi Schemer Cosmo Denied Bail for Now" Newsday (June 23, 2009)
  13. ↑ "'Accused NY Firm Manager Cosmo Freed on Bail', Reuters (July 23, 2009)". Reuters.com. Retrieved 2012-04-29.
  14. ↑ Bray, Chad (2009-10-09). "Judge Revokes Cosmo's Bail - WSJ.com". Online.wsj.com. Retrieved 2012-04-29.
  15. ↑ Bloomberg News via San Francisco Chronicle (October 15, 2011)
  16. ↑ "FBI — Former Agape World Inc. Account Representatives Charged in New York with Massive Ponzi Scheme". Fbi.gov. Retrieved 2012-04-29.
  17. ↑ "SEC Charges 14 Sales Agents in Long Island-Based Ponzi Scheme". SEC.gov. June 12, 2012.

External links

This article is issued from Wikipedia - version of the Sunday, February 07, 2016. The text is available under the Creative Commons Attribution/Share Alike but additional terms may apply for the media files.