Wextrust Ponzi Expands
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In an unsurprising move, the SEC amended its Complaint against Wextrust Capital
"its principals, and four affiliated Wextrust entities, to add defendant Joseph Shereshevsky's wife, Elka Shereshevsky, as a relief defendant, alleging that Joseph Shereshevsky attempted to hide more than $900 thousand in investor funds by placing them in accounts putatively in her name.
The amended complaint also adds broker-dealer fraud charges against defendant Steven Byers.
The Commission's original complaint alleged that defendants conducted a massive Ponzi-type scheme from 2005 or earlier that raised approximately $255 million from approximately 1,200 investors.
The targets of the fraudulent offerings are primarily members of the Orthodox Jewish community...
The Amended Complaint alleges that defendant Joseph Shereshevsky routinely placed his own assets - residential real estate, bank accounts, and a share in the ownership of Wextrust - in his wife's name.
The Amended Complaint further alleges that Elka Shereshevsky had a "no show" job at Wextrust and received improper transaction-based compensation and bonuses for sales of securities her husband made through Wextrust Securities while he was not registered as an associated person with it.
Although Elka Shereshevsky purportedly holds twenty percent ownership of Wextrust Securities as General Partner of the Shereshevsky Family Partnership, the Amended Complaint alleges that defendant Joseph Shereshevsky controls that interest.
The Amended Complaint further alleges that in early August 2008, when numerous Wextrust accounts had been frozen, defendant Joseph Shereshevsky directed his wife to open an account with a bank in Norfolk, Virginia, into which he diverted at least $75,000 of his own or Wextrust investment vehicle assets.
In addition, the court-appointed receiver in this matter has identified other accounts putatively controlled by Elka Shereshevsky that contain more than $825,000 of her husband's or the Wextrust Defendants' assets.
One wire transfer report showing a $100,000 transfer into such an account states, "per Joe's phone call," indicating Shereshevsky directed the transfer.
One thing that investors must realize is that the SEC and the federal appointed receiver are not their friends, lawyers or even care very much about their problems.
Don't wait on the SEC and its receiver, find some good attorneys who have experience in recovering funds.
(Sorry, I cannot help - little problem with not being licensed in the US to practise law!)
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Read More From BizOp News
August 25, 2008
Ad Surf Daily Not a Ponzi Scheme - Legal Expert Says So
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So is Ad Surf Daily a Ponzi scheme? Well, the Gerald Nehra, the MLM lawyer says no.
In his affidavit, in support of the Ad Surf Daily's motion for relief, Nehra claims that Ad Surf Daily is not a Ponzi scheme.
Nehra has submitted an affidavit tendering himself as an "expert witness" for Ad Surf Daily.
In his short affidavit, Nehra claims that Ad Surf Daily is not a ponzi scheme for three reasons.
1. First, nobody was promised a "return on investment".
2. Second, there is a product or service underlying Ad Surf Daily which sufficient to "sustain the promised payouts." [His exact words in quotes.]
3. Third, new participants are not needed to keep Ad Surf Daily afloat.
I pause to note the incongruity between 1 and 2; promised payouts are not a return on investment because the service contract language doesn't speak about returns, but rebates.
Uh, don't think this is going to work.
What is going to be at issue is whether people who bought into the Ad Surf Daily program actually a) had internet affiliate sites, and b) saw real increased traffic to their websites as the result of purchasing the advertising program.
It is note worthy that in the testimonials, over 1000 emails, in support of the Ad Surf Daily program, not one of the believers has put into affidavit form that fact that they saw increased traffic - pretty easy to do check.
The US Government was supposed to file a response to the emergency motion, but as of the time of writing this article, no such response was available through Pacer.
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