Life Settlement Ponzi Scheme

Seems like more and more ponzi schemes are being uncovered and now we find one that actually is linked to life settlements.  Life Settlement Fraud could not find any information about the life settlement DISP, we are still researching.

The U.S. filed civil and criminal charges against New York hedge-fund manager Edward T. Stein, accusing him of running a “classic Ponzi scheme” that moved more than $55 million through accounts while preying on friends and acquaintances.

Stein, who controls Gemini Fund I hedge fund, DISP LLC and Prima Capital Management Corp., moved millions from at least 83 investors through accounts he controlled, the U.S. Securities and Exchange Commission said in an “emergency enforcement action” filed today in federal court in Manhattan.

Federal prosecutors in Brooklyn, New York, charged Stein, 59, with criminal wire fraud for allegedly cheating a client out of $6.5 million. He was released on $2 million bond and ordered to surrender his travel documents after an appearance before U.S. Magistrate Judge Joan Azrack in federal court in Brooklyn.

Stein, who manages the Gemini Fund and founded DISP, a firm investing in life-settlement policies, has deceived clients since 1992 and resorted to stealing their assets, the SEC said in its civil suit.

Among companies Stein controlled was Prima Capital Management Corp., which he ran from his offices in Roslyn, New York, the SEC said

Stein was arrested by Federal Bureau of Investigation agents at his home in Manhattan today, Nardoza said. He faces as much as 30 years in prison if convicted of wire fraud. The SEC, which said it won a court order freezing Stein’s assets, is seeking to confiscate “ill- gotten” profits and impose unspecified fines.

The regulatory case is SEC v. Stein, 09-cv-3125, U.S. District Court, Southern District of New York (Manhattan) The criminal case is U.S. v Stein, 09-MJ-308, filed in Eastern District of New York (Brooklyn).

Source: Bloomberg