Thursday, December 18, 2008
Tennessee Stockbroker Charged In $9 Million Ponzi Fraud
Michael J. Park, of Brentwood, Tennessee, was charged today with three counts of mail fraud and one count of wire fraud in connection with a Ponzi-like investment scheme he allegedly ran. Park was the sole principal of Park Capital Management Group, in which he convinced investors to place funds for investment publicly traded securities. However, prosecutors allege Park used investor funds to pay earlier investors, purchase homes, expensive cars and other personal items. The scam ran from September 2001 toJune 2008, according to the complaint. He had promised investors returns as high as 28 percent. Park has admitted to the SEC that the investments have no value and he reportedly attempted suicide after the business was shut down this summer. He has also filed for bankruptcy and his wife has filed for divorce. Park faces up to 60 years in prison, plus fines and restitution.
According to U.S. Attorney Ed Yarbrough, the prosecutor in this case, a lot of investor fraud schemes are coming to light across the country because of the recession. "What happens when the economy takes a hit like it is now is these schemes can longer stay afloat and people want their money back and suddenly discover there's no money there," he said. "That's why during a period like this you see a rash of these kinds of cases. I don't think we've seen the end of it yet."
I agree wholeheartedly.
See the Nashville Post's series of articles on this cases here.