Did Bank of America enable a Ponzi scheme involving over a hundred Bank of America accounts? The complaint for this class action claims the bank aided and abetted fraud, aided in a breach of fiduciary duty, and supported a civil conspiracy, along with five individuals.
The class for this action is all persons who invested in First Nationle Solutions, Percipience Global, United RL, Lucian Development, and Middlebury Development.
According to the complaint, Perry Santillo, Christopher Parris, Paul Anthony LaRocco, John Piccarreto, and Thomas Brenner set up a Ponzi scheme that used false offering materials to get people to invest large sums of money in a group of fraudulent corporations.
Investments were sought for three of the corporations. First Nationle Solutions claimed to acquire, improve and sell commercial and residential real estate; Percipience Global claimed to provide loans to allow borrowers to buy and improve single-family homes; and United RS claimed to provide loans to allow medical practice to set up their own labs. The other two companies appear to have been used to help absorb and distribute the funds.
The conspirators raised $102 million from investors, purportedly to invest in these businesses, but, in reality, the complaint says, the funds were commingled in accounts with low or negative balances and then funneled to other accounts. Some of these were accounts belonging to one of the other businesses; some were personal accounts of the conspirators. Some of the money brought in from new investors was used to pay off older, redeeming investors.
The complaint claims that the conspirators had over one hundred Bank of America accounts, both for the businesses and for the conspirators personally, and that the scheme could not have gone on for so long had Bank of America not looked the other way instead of fulfilling its duties.
For example, banks must know their customers and are required to comply with the Bank Secrecy Act to prevent money laundering. They are to establish customer due diligence programs to assist them in predicting the types of transactions, dollar volume, and transaction volume that each customer is likely to generate, and then to keep track of the customers’ financial activity. The higher the risk presented by a customer, the more attention the bank is supposed to pay to its transactions.
Banks are required to look for red flags as set forth by the Federal Financial Institutions Examinations Council. The complaint claims that the conspirators’ doings at Bank of America provided plenty of red flags that should have raised an alarm at the bank, including the rapid and large number of transfers between accounts, the commingling of investor funds, and the transfers from company accounts to personal accounts.
Article Type: LawsuitTopic: Consumer
Most Recent Case Event
Ponzi Scheme Using Over 100 Bank of America Accounts Complaint
June 25, 2018
Did Bank of America enable a Ponzi scheme involving over a hundred Bank of America accounts? The complaint for this class action claims the scheme was created and operated by the five conspirators and the companies they set up, but it involved the use of over one hundred Bank of America accounts. The complaint claims that the account activities should have raised red flags and alerted the bank to what was going on.
bank_of_america_aided_in_ponzi_scheme_complaint.pdfCase Event History
Ponzi Scheme Using Over 100 Bank of America Accounts Complaint
June 25, 2018
Did Bank of America enable a Ponzi scheme involving over a hundred Bank of America accounts? The complaint for this class action claims the scheme was created and operated by the five conspirators and the companies they set up, but it involved the use of over one hundred Bank of America accounts. The complaint claims that the account activities should have raised red flags and alerted the bank to what was going on.
bank_of_america_aided_in_ponzi_scheme_complaint.pdf