Thursday 24 November 2011

Westgate victims still waiting payment a year after Ponzi Schemer went to Prison

Some of you may find this interesting. Just to give you all an idea of how long we may have to wait for any pay-out - once payments have been agreed and once Janvey has got his act together. Read this article and you will see why I am pushing for Grant Thornton to get access to the funds in Canada, Switzerland and the UK. If GT handle this, we will have direct access to them and can push for a speedy pay-out. That aside, we have Richard and 6 other victims on the committee who will make sure that any payment is swift and fair. If the money falls into the hands of Janvey and the committee we will be waiting forever to see a penny of it.

Westgate victims still waiting payment a year
after Ponzi schemer went to prison
FRIDAY, OCTOBER 28, 2011 LAST UPDATED: SATURDAY OCTOBER 29, 2011, 9:39 AM
BY ANDREW TANGEL
STAFF WRITER
THE RECORD

A year ago today, a federal judge sent James Nicholson away to prison for 40 years for running a $140 million Ponzi scheme. Attorneys and forensic accountants who helped recover investors' money have been paid, but the investors who entrusted their money to the former Saddle River hedge fund manager have yet to get back a penny.

Why the holdup? The federal government refuses to say. "You can't get an answer," said Jon Prusmack, a Rockland County businessman who along with his wife lost $13.2 million in the fraud, the second-largest amount lost of Westgate's nearly 400 investors. He's among the investors who have been prodding government officials for answers. "We get a lot of
smokescreen," he said. Nicholson's victims continue to complain of vague, noncommittal answers from the U.S. Attorney's Office in Manhattan, while estimated payment dates keep getting pushed back without explanation.
The U.S. Attorney's Office had previously told The Record it is "committed" to ensuring victims to what they're "entitled to" but did not say when the funds would be distributed. The clerk of court for the U.S. District Court, Southern District of New York, in Manhattan, which the U.S. Attorney's Office said would distribute the funds, would not respond to multiple requests over the phone and in writing. The clerk, Ruby Krajick, didn't respond to requests through a spokeswoman or a requested written inquiry. A call to U.S. District Judge Richard Sullivan, who sentenced Nicholson, went unreturned. Since July, six payments of Westgate investors' money — totalling $19.6 million — have trickled into
Sullivan's court, where Nicholson was prosecuted, pleaded guilty and was sentenced. That money could be earning interest in investors' bank accounts, or paying for living expenses, retirement or college
savings.

In Prusmack's case, the roughly $2 million he expects to get back from his Westgate losses could fund operations of two of his health and wellness, and sports and entertainment, businesses. "Rather than go borrow money, I'd rather use this," he said. Prusmack isn't facing the financial hardship experienced by other Westgate investors who have been struggling to make ends meet. "I just feel sorry for the other people," he said.

Howard Hellman, a Rockland County businessman who invested in Westgate after meeting an employee of the fund at the Church of the Presentation in Upper Saddle River, would like the government to return
his money, too. "As one of the investors, it's almost like a double whammy," Hellman said. "I do understand there's a process, but it's frustrating that the process is taking as long as it's taking." Victims of other recent Ponzi schemes have also had lengthy waits to get back their money.

A bankruptcy trustee in Bernard Madoff's case just sent out the first checks with investors' recovered funds earlier this month. Madoff was sentenced to 150 years in prison in June 2009. Investors in Texas financier R. Allen Stanford's alleged Ponzi scheme have yet to receive any
distributions of recovered funds, according to a trustee in that case. Stanford was indicted in June 2009
and his case continues.

E-mail: tangel@northjersey.com

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