With the highly-publicized Bernie Madoff Ponzi scheme, which resulted in an ABC mini-series and the HBO original movie, Wizard of Lies, investors might tend to think that Ponzis are a thing of the past. But Ponzi schemes are alive and well, and may even be on the rise. According to a New York Times report from last week, the United States Securities and Exchange Commission (SEC) has prosecuted 50 percent more Ponzi cases in the last 10 years since the Madoff scheme was busted, affecting over 4 million investors in 291 Ponzi cases, ultimately costing investors more than $31 billion in losses.
This week, the SEC filed charges against yet another Ponzi fraudster, James T. Booth, who the SEC alleges to have conducted a multi-year scheme, defrauding approximately 40 investors out of up to $10 million. The SEC complaint alleges that Mr. Booth fabricated elaborate account statements for his clients, many of whom were seniors and unsophisticated investors who utilized Mr. Booth to manage their retirement savings. Mr. Booth is 74 years old and resides in Norwalk Connecticut, and he is the founder of Booth Financial Associates, a firm originally created by Booth to sell advisory services and insurance products.
Mr. Booth was also a financial advisor registered with the investment advisory and brokerage firm LPL Financial LLC, a firm that is registered with the SEC and the Financial Industry Regulatory Authority (FINRA). Over time, Mr. Booth would solicit his customers from LPL to wire money away from LPL to invest in opportunities elsewhere, with promises of safer investments or higher returns.