Some investors who were "victims" of a Ponzi scheme in Texas may have found a way to turn their losses into fraud-squared gains. Derrich Pollock, whose financial background included stints working in an auto supply store and selling vitamin supplements, took in about $6.2 million from investors and ran his Bernie-like scheme. However, he also took out $9 million in insurance policies on himself which went to investors upon his death. When Pollock died in a plane crash in 2007, investors stepped up to the plate to collect.
But when local securities regulators had a closer look at Pollock's empire, they discovered he wasn't quite the stock genius you'd expect from somebody with an auto parts background. Between the remaining assets and the life insurance payments, investors (some of whom allegedly knew Pollock was running a Ponzi scheme) have already received 105% of what they invested. Now Pollock's wife, who filed for bankruptcy, is going after some of the investors for their winnings. Ruth Madoff may have a way to avoid taking the subway after all.
Widow of man who ran Ponzi scheme wants investors to return their profits [Austin American-Statesman]
Monday, July 13, 2009
Ponzi Hedging Strategy Yields 5% Return
Reprinted in full from DealBreaker: