{"id":55242,"date":"2024-01-09T10:35:41","date_gmt":"2024-01-09T18:35:41","guid":{"rendered":"https:\/\/cjnotebook.com\/?p=55242"},"modified":"2024-01-09T12:56:08","modified_gmt":"2024-01-09T20:56:08","slug":"calif-man-guilty-of-running-24-million-ponzi-scheme-duping-hundreds-of-victim-investors","status":"publish","type":"post","link":"https:\/\/cjnotebook.com\/?p=55242","title":{"rendered":"Calif. Man Guilty of Running $24 Million Ponzi Scheme, Duping Hundreds of Victim Investors"},"content":{"rendered":"

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0RIVERSIDE, California<\/em><\/strong><\/span><\/p>\n

\"\"A Riverside County man plead guilty to a federal criminal charge for running a Ponzi scheme that lasted nearly 20 years, according to officials.<\/span><\/p>\n

Paul Horton Smith Sr. fraudulently obtained over $24 million from at least 200 investors, the Justice Department announced Tuesday.<\/span><\/p>\n

\u00a0Smith, 59, of Moreno Valley, pleaded guilty to one count of wire fraud on Monday.<\/span><\/p>\n

According to his plea agreement, Smith operated Riverside-based companies named Northstar Communications LLC, Planning Services Inc., and eGate LLC. <\/span><\/p>\n

From July 2000 to May 2020, Smith obtained money from investors by soliciting individuals \u2013 often elderly or retired \u2013 to invest in something Smith called \u201cNorthstar.\u201d <\/span><\/p>\n

Some of the investors were Planning Services clients.<\/span><\/p>\n

\"\"Smith communicated with the victim investors regarding Northstar in person, over the telephone, and via email and text messages. He falsely told investors that Northstar was an annuity or an investment like an annuity.<\/span><\/p>\n

Smith falsely told other investors that Northstar invested in real estate or followed the stock market. He typically told the investors that their investment would generate a fixed rate of return and was a \u201csafe investment.\u201d<\/span><\/p>\n

While Smith led most Northstar investors to believe his company reinvested their initial investment, generating the percentage they were to earn, he never invested the money.<\/span><\/p>\n

\"\"<\/span><\/p>\n

Instead, Smith deposited all investor funds into a non-interest-bearing checking account.<\/span><\/p>\n

Smith used some money from later Northstar investors to pay earlier Northstar investors\u2019 monthly interest payments and to repay earlier investors who wanted to withdraw their investment.<\/span><\/p>\n

For example, in April 2019, Smith caused one victim to invest him $400,000 \u2013 life insurance proceeds after the victim\u2019s spouse had died. <\/span><\/p>\n

\"FBI
FBI Photo Image<\/figcaption><\/figure>\n

The victim wrote a personal check for that amount, and was deposited into a bank account in Riverside and was then electronically transferred to the bank\u2019s Alabama headquarters for processing.<\/span><\/p>\n

Smith promised the victim he would invest the $400,000 in a safe investment with a 5% rate of return. But Smith never invested the money. Instead, he transferred the funds to pay other victims of his Ponzi scheme. <\/span><\/p>\n

To conceal his criminal activity, Smith made 11 payments to the victim totaling $163,324.<\/span><\/p>\n

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 As a result of the scheme, Smith fraudulently obtained more than $24 million from at least 200 investors. Of these investors, 106 victims have not been fully repaid. The total loss for these victims is $13,331,505.<\/span>\u00a0 \u00a0\u00a0<\/span><\/p>\n

\u00a0 \u00a0 \u00a0 \u00a0 \u00a0The FBI investigated this matter. <\/span><\/p>\n

The United States Securities and Exchange Commission, which filed a complaint and obtained a judgment<\/a> against Smith and Northstar Communications LLC in 2020, assisted.<\/span><\/p>\n

Assistant U.S. Attorney Benjamin J. Weir of the Riverside Branch Office is prosecuting this case.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0RIVERSIDE, California A Riverside County man plead guilty to a federal criminal charge for running a Ponzi scheme that lasted nearly 20 years, according to officials. Paul Horton Smith Sr. fraudulently obtained…<\/p>\n","protected":false},"author":1,"featured_media":7040,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7,3],"tags":[],"class_list":["post-55242","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-courts","category-u-s-department-of-justice"],"yoast_head":"\nCalif. 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Man Guilty of Running $24 Million Ponzi Scheme, Duping Hundreds of Victim Investors\" \/>\n<meta property=\"og:description\" content=\"\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0RIVERSIDE, California A Riverside County man plead guilty to a federal criminal charge for running a Ponzi scheme that lasted nearly 20 years,\" \/>\n<meta property=\"og:url\" content=\"https:\/\/cjnotebook.com\/?p=55242\" \/>\n<meta property=\"og:site_name\" content=\"American Justice Notebook\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AmericanJusticeNotebook\" \/>\n<meta property=\"article:published_time\" content=\"2024-01-09T18:35:41+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-01-09T20:56:08+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/cjnotebook.com\/wp-content\/uploads\/2014\/10\/Ponzi-Scheme-Image-Courtesy-FBI.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"260\" \/>\n\t<meta property=\"og:image:height\" content=\"180\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Raul\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Raul\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=55242#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/?p=55242\"},\"author\":{\"name\":\"Raul\",\"@id\":\"https:\\\/\\\/cjnotebook.com\\\/#\\\/schema\\\/person\\\/f5521baddca77b521f012298775186c0\"},\"headline\":\"Calif. 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