Florida Business Man Admits to Investor Fraud Involving $880 Million
A Florida businessman has pleaded guilty to investor fraud involving nearly
Nevin Shapiro, 41, of Miami Beach, FL, admitted in federal court on Wednesday, September 15, 2010, of running a Ponzi scheme from January 2005 to November 2009, when his investment scam finally fell apart.
Mr. Shapiro has been accused of taking money from investors from around the United States by telling them that he would be investing in a grocery distribution business. Instead, Mr. Shapiro allegedly used a portion of the money to support his luxury lifestyle, which included illegal gambling debts and floor seats for the Miami Heat.
Mr. Shapiro has also been accused of using the funds to make payments on a $5 million Miami Beach home, as well as on a $1.5 million Riviera yacht.
In a typical Ponzi-like fashion, Mr. Shapiro used money from new investors to pay existing investors.
Federal agents arrested Mr. Shapiro in April 2010. The arrest came approximately five months after his company, Capitol Investments USA Inc, was forced to file for bankruptcy. He has been charged with fraud and pleaded guilty to money laundering.
Mr. Shapiro is scheduled for sentencing on January 4, 2011. He faces up to 20 years in a federal prison and a $5 million fine for the fraud charges. He could also get an additional 10 years in prison for the money laundering charges.