Tuesday, January 20, 2009

Tuesday Night Ponzi: Forte Capital

Florida, Indiana, Georgia, even Idaho, ponzis seem to pop up in the strangest of places. Next up: Philadelphia, where Joseph Forte, 53, was charged by U.S. prosecutors with mail fraud allegations that he ran a $50 million Ponzi that bilked charity, church and private school investors. Forte apparently ripped off 80 investors between February 1995 and 2008. Forte "made" its money trading S&P 500 stock index futures. Oh come on, no hedge fund in modern history has made a penny trading that stuff. But apparently Forte told the prosecutors that he "falsely reported investment returns of up to 38% when in fact he regularly lost money in his futurea trading." Forte had told investors his fund had a value of more than $154 million when the trading account was worth less than $146,814 but at least he paid himself million of dollars in salaries and fees.

We are curious where the hell are the auditors who go through the books of all these Ponzi schemes? Was Arthur Anderson auditing this guy?
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