Two More Ponzi schemes exposed in the US

PHILADELPHIA & UTAH - An investment fund manager has pleaded guilty to charges of fraud and money laundering in relation to an $80 million Ponzi scheme. Federal prosecutors in Philadelphia said Joseph Forte had deceived up to 80 investors during the years between 1996 and 2008 by claiming their money would be used to trade stock index futures. Forte claimed his backers would receive returns of between 18% and 38%, while in reality he was losing money on his trades and paying out returns using cash from new investors.

Assistant US attorney Joe Kahn confirmed to a local radio station that Forte had paid himself millions of dollars in salary and that, while running the scheme, he had used investors' cash to buy himself a home and make donations to a number of schools and a church. Other media reports indicate he had also used fabricated profits to secure other financial transactions, including taking out a $500,000 loan by misrepresenting the value of his investment firm. Forte will be sentenced in October.

Meanwhile, a Utah businessman and host of the Free Capitalist radio show has been indicted by a federal grand jury over allegedly running a $100 million Ponzi scheme. Claud Koerber, also known as Rick Koerber, faces charges of mail fraud, wire fraud and tax evasion. He is alleged to have obtained the money through loans for Founders Capital, a subsidiary of his Provo-based real estate firm FranklinSquires.

Akin to other Ponzi fraudsters, Koerber is accused of using investors' cash to fund his personal interests, which according to local press reports included investing $850,000 in restaurants, $1 million in luxury automobiles and $5 million in filmmaking.