Free Republic

The co-owners of DC Solar Solutions, Inc. plead guilty on Friday to charges associated with running a one billion dollar Ponzi scheme. Jeff and Paulette Carpoff (along with five others who have/will plead guilty) acknowledged that between 2011 and 2018 they sold investors mobile solar generator units (MSGs) that did not exist and manipulated documentation (think: financial statements, lease contracts) to make it appear as if the units had been leased out and were in use. New funds were used to pay the scam’s earliest investors and to make several sports related purchases including; NASCAR sponsorships, an independent league baseball...

This is how the WeWork story ends—for now. The high-flying office-sharing startup, which introduced itself to the world as “a community company” with a mission to “to elevate the world’s consciousness,” is paying its founder, Adam Neumann, more than $1 billion to go away. Meanwhile, the company is so cash-poor that it cannot afford to pay the severances of the 4,000 workers it intends to cut. WeWork’s free fall from a projected valuation of nearly $50 billion to just $5 billion will likely be taught in business school, immortalized in best-selling books, and debated among analysts for years. But one...

An incredible collection of nearly 150 classic and modern cars is coming up for auction, but they each come with a conflicted history. The cars were seized by the feds from the owners of DC Solar, who have been accused of running the bankrupt solar-powered generator company as an $800 million Ponzi scheme. Jeff and Paulette Carpoff haven’t been charged with any crimes as of yet, according to the U.S. Attoney’s office, but their situation remains under investigation. In the meantime, the Carpoffs and the Department of Justice agreed to hold an interlocutory sale and put the proceeds into a...

Amid a downturn in the cryptocurrency markets, the apparent swathe of Bitcoin sell-offs from a $3 billion Chinese Ponzi scheme could be to blame. On Aug. 14, Dovey Wan — founding partner of blockchain-based investment company Primitive Ventures — called attention to the ongoing mass sell-offs from the fraudulent Chinese investment scheme, dubbed PlusToken. 10 million investors scammed of $3 billion As Wan outlines, PlusToken was created in mid-2018 and promised high yield investment returns at different rebate percentages to its four tiers of member — a classic Ponzi scheme structure. By early 2019, the project claimed to have over...

Bernie Sanders .. wants to expand Social Security, even as the program will pass an omnious tipping point. Some time next year, as the ranks of retirees swell, the Social Security system in the United States will pass an ominous tipping point and start the slide into insolvency. For the first time in nearly four decades, the government program that provides retirement checks to older Americans will pay out more in benefits in 2020 than it takes in. That will force the program to dip into a rainy day fund that will be depleted in about 15 years. And if...

We wonder what reaction Bernie Madoff is having in the cell that’s serving as home for all of his life sentences, now that DC Solar’s alleged Ponzi scheme has claimed its third financial victim, this one more severe than the last. Just under a month ago, Progressive and Hancock Whitney reported that they’d been hit by the alleged $810 million scheme, with Progressive reporting “tens of millions” in losses and Hancock Whitney, a bank with locations in Louisiana and Mississippi, had to lower its first quarter earnings by $10.1 million. The newest development is much, much larger, as multinational holding...

Of the $54 million believed to have been invested in Mantria, $17 million was returned to early investors to perpetuate the Ponzi scheme and make later investors believe huge profits could be had. By the time the Securities Exchange Commission shut down Mantria in 2009, just $790,000 remained from the other $37 million. In addition to the sheer size of the scam, the reach that Wragg and Knorr achieved in a few short years out of college remains hard to fathom. Former President Bill Clinton personally honored their now disgraced work in a ceremony for the Clinton Global Initiative in...

For each active worker, four pensioners. For 169 governmental bodies, the numbers are lopsided. In some cases hundreds — and in Chicago’s case, thousands — more retirees are drawing from a fund than active workers are paying into it. Even in a small suburban district such as the Arlington Heights Park District, 432 retirees are pulling from that district’s pension fund with only 103 active employees paying into it. In the city of Chicago, according to the treasurer’s numbers, the gap is smaller in percentage terms, but in terms of the gap, more dramatic. Including Chicago Board of Education administrative...

The QuadrigaCX cryptocurrency exchange says it can't access some $190 million in bitcoin and other funds after its founder and CEO, Gerald Cotten, died at age 30 — without sharing the password for his encrypted laptop. Cotten was "the sole officer and director" of the Canadian cryptocurrency exchange when he died, said his widow, Jennifer Robertson, in an affidavit that is part of the company's request for court assistance as it seeks protection from its creditors. The debt filing comes weeks after Robertson announced that Cotten had died — an event she described as "a shock to all of us."...

Aging population is boosting the costs of Social Security and Medicare as growth projections ease The Social Security program’s costs will exceed its income this year for the first time since 1982, forcing the program to dip into its nearly $3 trillion trust fund to cover benefits. This is three years sooner than expected a year ago, partly due to lower economic growth projections, according to the latest annual report the trustees of Social Security and Medicare released Tuesday. The program’s income comes from tax revenue and interest from its trust fund. The trust fund will be depleted in 2034...

What do the three pictured flags have in common? The first is the flag of the USSR (Union of Soviet Socialist Republics). Estimates are that 40,000,000 to 60,000,000 people lost their lives under the rule of Stalin's iron fist. The third is the Chinese flag. Everyday hard-working people did not fare well in Mao's China either. Anywhere from 49,000,000 to 78,000,000 died under Mao's communist society. In the middle is the flyer that teachers' unions distributed to Colorado teachers with their Walk-Ins tool-kit encouraging Englewood's teachers to protest and walk out of class recently. Additionally, the teachers' unions are organizing...

On Thursday, September 7, the Acting United States Attorney for the Western District of Tennessee, Lawrence J. Laurenzi, announced the federal sentences given to Larry Bates and three other members of his family for their convictions in a gold and silver Ponzi scheme that defrauded customers from around the country of over $26 million USD in unfulfilled orders. Sentencing had been delayed due to legal motions filed by the defense. After a five-week-long trial in May of this year, former Tennessee state representative and Christian talk radio host Larry Bates was convicted of the 46 counts of mail and wire...

The government is out today with its annual update of Social Security’s sick finances: --The system is $12.5 trillion under water, up from $11.4 trillion a year ago. --Absent law changes, checks to retirees will have to be chopped 23% beginning in 2035. --To fix just the retirement pay program, Congress could kick up the payroll tax by 2.8 percentage points. Fixing Medicare’s disastrous finances would be in addition. --The retirement operation is running an $86 billion annual deficit. That’s the difference between the money coming in from Social Security’s share of payroll taxes (12.4% of covered payroll) and the...

Social Security's unfunded liabilities total $12.5 trillion in present-dollar terms over a 75-year timeframe, the administration's trustees reported Thursday, an increase of $1.2 trillion from last year's estimate. The trustees report showed that Social Security's combined trust fund can only pay scheduled benefits through 2034, a projected date that is unchanged from a year ago. Medicare's trust fund, though, is in better shape than previously estimated and will run out a year later than previously anticipated, in 2029. At those dates, beneficiaries would face the prospect of an immediate cut in benefits unless policy were changed in some way to...

In fact, it’s not “inexplicable” at all. ___ Tesla shares rose to $313.38 this morning, giving the company a market capitalization of about $51 billion, surpassing GM for a moment as the most valuable American automaker. This left some industry insiders wondering about tulip bulbs. “It’s either one of the great Ponzi schemes of all time, or it’s all going to work out,” mused Mike Jackson, CEO of AutoNation, the largest dealer group in the US. He was speaking at a conference hosted by the National Automobile Dealers Association and J.D. Power. “It’s totally inexplicable, as far as its valuation,”...

Earlier today the Kersten Institute for Governance and Public Policy highlighted an updated pension study, released by the Stanford Institute for Economic Policy Research, which revealed some fairly startling realities about California's public pension underfunding levels. After averaging $77,700 per household in 2014, the amount of public pension underfunding for the state of California jumped to a staggering $92,748 per household in 2015. But don't worry, we're sure pension managers can grow their way out of the problem...hedge fund returns have been stellar recently, right? Stanford University’s pension tracker database pegs the market value of California’s total pension debt at...

Few if any candidates for federal office will tell you that as a consequence of current federal law, young Americans are being screwed in two life-changing ways. First, under current law, every Social Security beneficiary under the age of 48 will have their promised benefits cut by a third. And second, every young person who works is contributing between $10,000 and $20,000 to the health care and retirement of those lucky Americans who are already drawing benefits under federal law. In some ways the second screwing is worse than the first. Young workers do not have the defined benefit retirement...

Berkshire Hathaway Inc has been sued by a New York bicycle courier company over an alleged illegal scheme to cheat employers buying workers' compensation policies. The complaint, filed late Friday by Breakaway Courier Systems, came as Berkshire's Applied Underwriters unit faces scrutiny over its workers' compensation policies, including some that have been banned by California, Vermont and Wisconsin. Breakaway, with about 300 employees, accused Berkshire and Applied of "siphoning" premiums through a web of illegal shell companies, with diverted premiums going to unlicensed out-of-state insurers. The plan amounted to a "reverse Ponzi scheme" where unsuspecting employers expecting to buy affordable...

How online auctioneer EnergyNet helps bring liquidity, and recovery, to America’s busted oil patch. In the first 18 months of the oil bust, 70 companies have gone bankrupt, defaulting on $40 billion in debt. A trillion dollars of oil company equity has been wiped out. Layoffs top 200,000. With oil holding at around $45 a barrel, more liquidations are on the way. Already the old guys swear this bust is worse than in 1986, when oil dropped below $25 in today’s dollars. At least one thing is better now: Thanks to the magic of the Internet, it’s easier for cash-strapped...

Computer automated hedge fund strategies weren't the only winners amid recent volatility. Hedge funds also appear to have timed oil’s recent slump and rebound. That's according to Bloomberg's Moming Zhou, who reports  that hedge fund significantly curbed their bearish positions in crude oil just after it fell to a 12-year low last week -- and then rebounded in its biggest jump since 2008. While oil had a brutal start to 2016 after a disappointing 2015 showing, many are coming around to the idea of a recovery in prices, as Citi argued it could be the trade of the year, some...