A US financier has been charged with running a $13.2m Ponzi scheme, supposedly trading in Facebook and other social networks' pre-IPO shares despite the fact that he didn't have access to them. Craig Berkman, a former Oregon gubernatorial candidate now living in Florida, had allegedly promised his investors that he had insider …
Arn't they lucky....
... that they didn't won real farcebook shares, as they could have lost even more money!
Politicians and wannabe politicians
They are pretty much all the same, they are institutionalised petty thieves, some are more successful than others and if they are caught they either use their connections or have enough dirt on people in high places that they get a lenient sentence.
Many of out Members of Parliament deserved to spend time at HM Pleasure but got the benefit of the doubt by claiming 'it was within the rules'.
'Within the rules' is obviously a game played by different rules to the rest of the population.
Re: Politicians and wannabe politicians
And those tasked with making the rules make them deliberately ambiguous...
Why wasn't he jailed?
Bet they wont put him in jail even this time. So he can be off to more shenanigans defrauding naive investors so he can pay his court fines, genius!
Re: Why wasn't he jailed?
Yeah, it does look like a protection racket run by the courts, doesn't it?
"Nice lifestyle ya got there, shame if ya had to do jail time. Don't worry, as long as we get our cut, you're a free man!"
They gave him how much?
Without checking into his previous financial, erm, shenanigans?
Re: They gave him how much?
You may have noticed that the previous shenanigans were in Oregon, and this was in Florida and New York, on the opposite side of the country. That probably enabled him to cover his track long enough to get this scam started and running before it collapsed.
A small amount of blame could in theory be attached to lack of due diligence on the part of the investors.
Re: They gave him how much?
florida, oregon, NY so why no RICO angle?
The essence of confidence trickery
For these things to work , you need suckers, i.e. people who regard themselves as law-abiding, but get a frisson of excitement from eg buying "dodgy" goods down the pub etc(that they think are stolen designer clothes that "fell off the back of a lorry", but really are legit counterfeit rubbish). Any sensible person knows you're unlikely something for nothing (or higher returns than you'd realistically expect) but suckers love to think they've got an inside track, even though for that to be true, it would have to be illegal or just completely made up. Just tap the side of your nose & they'll come running, the mugs.
Like the "victims" of Madoff, they really are asking for it - never give a sucker an even break :-)
There's definitely a Darwinian component in this sort of fiasco.
Re: The essence of confidence trickery
"higher returns than you'd realistically expect"
like everyone whoever bought a share, ever you mean?
I like the way you are thinking.
<let the downvotes commence - day traders almost as bad as cyclists>
Only joking - far too many big words in that article btw
the whole FacebooK IPO was a Ponzi scheme.
Re: I thought
"the whole FacebooK IPO was a Ponzi scheme."
No. In a Ponzi (I quite like the term "rollover") you use money from initial investors to pay later
In Facebook you run a campaign to convince people the "value" of the company is way more than it's total asset worth and its revenue (IIRC the P/E ratio for Facebook was in the 100s. IE if Facebook distributed all their profits back to their stockholders it would take them centuries to get back what they paid for them unless the price rose above what they paid for them).
That's more like a "pump and dump" scheme. Which appears to have been plaid with fake press releases for some firms and can happen amazingly quickly.
What kind of politician?
"Craig Berkman (born about 1943) is a longtime venture capitalist and was an influential Republican politician in the U.S. state of Oregon. "
This means more to Americans, but sort of like Conservative politicians.
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