New York (HedgeCo.Net) – Nicholas Cosmo, head of New York-based Agape World Inc., has been arrested for allegedly running a $400 million Ponzi scheme. His company, which marketed commercial bridge loans, was not registered with the U.S. Securities and Exchange Commission.<\/p>\n
“Some of the early investors made money but as this scheme started to crumble, the later investors did not see a penny,” said one law enforcement official, referring to the classic Ponzi scheme, where new money coming in is used to pay off earlier investors. <\/p>\n
Agape World Inc. had bragged to clients that they posted consistent returns of around 14 percent. Had investors performed a due diligence on Cosmo, they would’ve found that he was convicted in 1999 of fraud and sentenced to 21 months in prison. <\/p>\n
Agape World Inc. was essentially aiming to be an asset based lender. They supposedly provided project loans on construction, acquisition loans and provided financing for unfinished properties. <\/p>\n
The trouble in the markets lately has highlighted the immense presence of Ponzi schemes all around the country. Even after the $50 billion Madoff debacle, a handful of Ponzi schemes and fraudsters have floated to the surface. Arthur Nadel of Sarasota, Florida, disappeared along with his client’s $350 million in cash. Shortly after, Michael Riolo of Boca Raton was targeted, accused of bilking $50 billion out of investors.<\/p>\n
<\/p>\n
Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net<\/p>\n
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