Ponzi Arena at Madoff Park
It seems like everything week we get word of another high-flying financier busted for running a high-flying finance firm that’s nothing but the low finance of pyramid schemes. In this week’s installment of Ponzis on Parade, we get a guy who not only screwed over investors, but also children who thought they would be playing sports this winter!
A large Long Island youth sports complex is going to be shut down for quite some time after its financier was busted on charges related to running a Ponzi scheme, according to Newsday. Well, it’s not like anyone could get too used to the place: it was opened one Saturday morning, and shut down by fire marshals that same afternoon.
Even before its financier got busted, the facility was under siege (rightfully so, it sounds like) from city hall over its construction, and the federal charges only finalize what has been going on since early December — apparently hundreds of young soccer, football, baseball, basketball and lacrosse players are either scrambling to find somewhere else to play, or just out of luck because of the closure of the $3.5 million National Tournament Athletic Center in Hauppage, N.Y. Authorities say its funding came from a $370 million Ponzi scheme run by one Nicholas Cosmo, a 37-year-old now in jail on charges of mail fraud for a scheme that allegedly bilked more than 1,500 investors.
According to Newsday, Cosmo also used $300,000 to fund a travel baseball league he founded. If you were planning on having your child in the NTB Travel Baseball League this spring, you might want to make other arrangements. (I called both numbers on the Web site — one sends you to an automatic voicemail with Nick Cosmo saying his name, and a prerecorded note that he is not available. Boy, isn’t he. The other number is for Agape World, his finance company. If you press 0 for the operator, you get a message that the mailbox is full. Boy, isn’t it.)
I feel terrible for the children getting shafted through no fault of their own. However, I grow less and less sympathetic for the investors in supposed guaranteed-return deals. Nothing is guaranteed, folks. More than a year ago, a long, long thread started about Agape World on a site called FatWallet.com, where not only was it made clear that Cosmo had a previous felony conviction (with jail time) for fraud, but that he also had to get “intensive outpatient gambling therapy” as well. And it appears Cosmo appeared on the site to cop that it was all true!
And here people used to think the lottery was a tax on stupidity.