Articles Tagged with affinity fraud

The U.S. Securities and Exchange Commission (SEC) has charged former Boston resident, and current Miami resident, Mark A. Jones with operating a $10 million Ponzi scheme that claimed to generate profits from “bridge loans” to Jamaican businesses.

According to the SEC’s Complaint — filed earlier this month in federal court in Boston — Mr. Jones began soliciting investors in 2007 and said their money would be pooled and used for “bridge loans” to Jamaican businesses awaiting funds from approved commercial bank loans.  Mr. Jones purportedly told the investors that the loans would generate approximately 15 to 20 percent interest each year.  He appeared in YouTube videos promoting investment opportunities in Jamaica and even met with some investors in Jamaica to show them local projects in which their funds were purportedly invested.  Contrary to those representations, though, the SEC alleges that Mr. Jones was actually using investors’ money to pay other investors — the hallmark of a Ponzi scheme.  In addition, Mr. Jones is alleged to have used some of the invested funds for his own personal use.  In all, Mr. Jones raised about $10 million from at least 21 investors in several states and Washington, D.C., including some of his own relatives.  Targeting investors from the same community or religious group is generally referred to as affinity fraud.

The SEC has obtained a Court order freezing Mr. Jones’ assets and an order to repatriate investor funds that were moved overseas.  In addition, the SEC is seeking a permanent injunction, return of allegedly ill-gotten gains with interest, and other monetary penalties.  Mr. Jones is also being criminally prosecuted by the U.S. Attorney for the District of Massachusetts for his actions.