$74 Million dollar scheme, defrauded over 3,200 investors according to SEC
The Commission announced the promoter of a fraudulent prime bank scheme, which raised over $74 million from at least 3,200 U.S. and Canadian victims was sentenced to 30 years in prison. The promoter was convicted on multiple counts of wire fraud, mail fraud and securities fraud in the criminal trial, in which five other people were either convicted or pleaded guilty.
The criminal case followed the filing of an action by the SEC in May 2000, in which emergency relief including an asset freeze was obtained. The Commission’s complaint alleged that the defendants promised investors in two programs, Oakleaf International and Rosewood International, a return of 120% per year, as well as preservation of their invested funds, through an unspecified “trading program”. The complaint alleged that, contrary to these representations, the defendants misappropriated investor money for personal expenses and failed to engage in any profitable investments.
In the civil case, which has been stayed pending the resolution of the parallel criminal action, the SEC also obtained the appointment of a Receiver to marshal assets and distribute them back to defrauded investors. To date, the Receiver has collected approximately $20 million on behalf of investors.
The Receiver will propose a distribution plan following the conclusion of the Commission’s case. [SEC v. John Wayne Zidar, et al., d/b/a/ Oakleaf International, Rosewood International and Meliorations Management Teem, No. C00-823C (USDC W.D. Washington)] (LR-18267)
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Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.
He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.