Let us look at the background of one of the owners, for we can better understand why the fraud occurred if we examine the players. Most of this was available on the Internet, and the investors, had they performed only superficial due diligence, would have picked it up. Unfortunately, their levels of greed (high rates of return) blinded them.

Granted, I must confess that I have a debt of sorts to this individual, for he hired me for compliance, notwithstanding my criminal record. He engaged me after I demonstrated that my enhanced due diligence techniques were superior to those of the firm's giant outside law firm. My skills got me the job, despite my past.


A short summary of this owner's "credentials," so to speak:

• Four actions, dating back in the 1980s, taken by the Commodities Futures Trading Commission [CFTC], which culminated in a Permanent Bar and civil Penalty.

• A permanent SEC Injunction from 1998, resulting in the disgorgement of $850,000. Thereafter, ownership of an investment firm was barred, so a figurehead CEO was employed, to front for the disqualified owners

• A prior Federal conviction for mail fraud and wire fraud.

The owner paid $9m in disgorgement penalties to the SEC, but the criminal case did not go away.When formal charges against him ultimately surfaced, in early 2009, a 25-count indictment, charging conspiracy. wire fraud, mail fraud and money laundering, was filed.The allegations:

• That he participated in a wide-scale fraud, involving the sale of investments.

• That he falsely promoted " safe and secure"investments, which were improperly acquired, contained altered and inaccurate data and information, and whose escrow funds were mismanaged.

• That documents, prepared by the consulting physician, were improperly altered to decrease estimated life expectancies. The defendant is blamed for those fraudulent modifications.
  

Strangely enough, in a system where swift justice is usually the order of the day, the trial has been delayed until 2011, and much of the court file is sealed. Media accounts claim that the owner has charged several Florida public officials with corruption, that he allegedly wore a concealed microphone when communicating with some of them, and that a major public corruption case, involving Florida regulators, is under investigation. Is he himself rendering Substantial Assistance, in an effort to reduce his ultimate sentence?


If you have ever been involved in financial crime, you always cash payroll cheques, and do not deposit them. When the Receiver took over, he stopped payment on all outstanding cheques, including large payments to investors that were in the post. I was lucky; I'd received my salary the previous Friday, but had been to busy to get to the bank to cash it. On the following Monday morning, the branch bank where I usually stopped didn't have enough cash, so I waited until Tuesday to cash it. Early the next morning, the Receiver took over. I had just narrowly avoided losing one month's salary.

Next Week: Murder most foul. Out of work, I partner up with one of my high-flying colleagues, but his success, and his life, are brutally cut short. Never underestimate the fury of a scorned domestic partner.