"He's accepted responsibility and hopes to make the victims whole." $880 Million ponzi scheme

[SoCalDem]

http://www.ibj.com/defendant-pleads-guilty-in-880m-fraud-case/PARAMS/article/22293


A Florida man known for his sports-related philanthropy pleaded guilty Wednesday to running a multistate Ponzi scheme that prosecutors say left investors, including some in Indiana, with up to $100 million in losses. Nevin Shapiro pleaded guilty in New Jersey federal court to one count of securities fraud and one count of money laundering as part of an agreement that still has him facing up to 17 years in prison at his Jan. 4 sentencing. Prosecutors say 41-year-old Shapiro of Miami Beach used a Florida-based company called Capitol Investments USA Inc. to raise nearly $900 million from investors who thought they were buying into a wholesale grocery distribution business.

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Charges filed by the Securities and Exchange Commission claim Shapiro promised investors risk-free annual returns as high as 26 percent by persuading them to invest in a "grocery diversion" enterprise—a practice of buying low-cost groceries in one region of the country and reselling them in higher-priced markets. Shapiro allegedly siphoned at least $35 million of the proceeds for personal use, including $23 million for salaries and commissions for himself, $5 million for a Miami Beach mansion and $400,000 for courtside Miami Heat basketball tickets. He also spent lavishly on luxury cars, a high-stakes gambling habit, and a pair of diamond-studded handcuffs given to an unnamed prominent athlete, according to court documents.

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"Nevin Shapiro made a name for himself as a big contributor to student athletics, showering his favorite players with gifts and cash, living the high life, and rubbing elbows with the pros," Fishman said. "Today, Shapiro admitted that he built the facade of his lifestyle with money he stole from those who trusted him."

Shapiro's lawyer, Maria Elena Perez, said her client was in bankruptcy but was working on giving his victims restitution. "I think today was the first day toward closure," she said. "He's accepted responsibility and hopes to make the victims whole."