Man Pleads Guilty in South Florida Real Estate Ponzi Scheme

Man Pleads Guilty in South Florida Real Estate Ponzi Scheme
shapiro, company, investors, munns, fraud, funds, federal, woodbridge, florida, scheme

A House of Cards

The government was involved in a two-year-long probe into Woodbridge Group, which was originally founded in Florida. In 2017, when Shapiro and the company did not have enough funds to pay out prior investors with new investor money, the scheme began to unravel.

Earlier this year Shapiro admitted to a Miami federal court that his business was a sham. His $1.3 billion ponzi scheme paid for his and his family’s luxurious lifestyle, which included misappropriation of between $25 million and $95 million. Shapiro used his clients’ funds to pay for chartered planes, trips around the world, a luxury convertible, vintage wine, jewelry, diamonds, and artworks created by the masters. According to federal prosecutors, at least 2,600 of Shapiro’s victims invested their retirement funds in his company and the total amount invested was $400 million. Shapiro faces up to 20 years in prison, as he pled guilty to tax evasion and conspiracy.

The Securities and Exchange Commission (SEC) settled a civil action against Woodbridge Group, Shapiro, and several related shell companies resulting in a $1 billion settlement that could be utilized as restitution to his victim investors. According to court documents, Woodbridge and its agents were in violation of securities laws because they operated as broker-dealers, selling clients mortgage notes without properly notifying them of the risks involved.

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How to Protect Yourself Against Fraud

While not every investment opportunity is a scam, unfortunately, fraud is out there. Often times, the perpetrators have become more and more sophisticated. The more primitive the fraud is, the easier to spot. Below are some tips on how to protect yourself from investment fraud.

  1. Check the registration with a governmental authority – the purpose of agencies such as the Federal Trade Commission and the Security and Exchange Commission is to make sure investors do not fall prey to scammers. If the company you are looking to invest in is not registered, steer clear of the deal.
  2. Stay clear of social media or email posts – with the prevalence of Facebook, Twitter, Instagram and email communication, criminals go to popular areas to plant their schemes. If you are getting emails or seeing social media posts saying you should invest in something you have never heard of, it is likely a scam no matter how legitimate it may appear.
  3. Nothing is truly free – one of the easiest traps to fall into is when the company hands out a small, free gift to potential investors to go with the product that is being sold. Because investors feel like the company cares about them, they put their guard down and trust when they probably should not. While legitimate companies give out perks as well, be sure to do your research before investing your hard earned money.

In 2017, when Shapiro and the company did not have enough funds to pay out prior investors with new investor money, the scheme began to unravel.

Your Florida Fraud Defense Attorneys

If you or someone you know has been taken advantage of through a fraudulent investment, contact the experienced fraud defense attorneys at Bogin, Munns & Munns. We will fight to protect your rights and interests under applicable federal and/or state law. Contact us today to schedule your consultation.


NOTICE: The article above is not intended to serve as legal advice, and you should not rely on it as such. It is offered only as general information. You should consult with a duly licensed attorney regarding your Florida legal matter, as every situation is unique. Please know that merely reading this article, subscribing to this blog, or otherwise contacting Bogin, Munns & Munns does not establish an attorney-client relationship with our firm. Should you seek legal representation from Bogin, Munns & Munns, any such representation must first be agreed to by the firm and confirmed in a written agreement.

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