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Ponzi Scheme

FSS was hired by the bankruptcy trustee to determine if an investment run by a rogue money manager (“the Project”) was a Ponzi scheme and to testify before the bankruptcy court regarding our findings.

New investors were promised unusually high rates of return. The payment of accrued interest to short term investors was paid current and there was a constant influx of new investors.  Funds from the later investors were used to pay interest and redeem earlier investors. When the ability to pay its obligations waned, so too did the influx of new investors and the Project imploded.