Duly Noted

 Schuette announces pleas for two charged in West Michigan Ponzi scheme

Michigan Attorney General Bill Schuette has announced that Thomas Doctor, 53, and  Douglas Kacos, 58, both of Grand Rapids, pleaded no contest to Money Laundering for their role in a massive Ponzi scheme that operated under the name API Worldwide, Inc.  The no contest pleas follow a joint investigation by the Department of Attorney General and the Department of Insurance and Financial Services which revealed API defrauded about 140 victims out of $9 million in total, including elderly victims who lost their life savings.

 “Financial scams that target vulnerable seniors can devastate our parents and grandparents ...,” said Schuette.  “These convictions bring us closer to securing justice for the elderly victims of the API Worldwide investment scam.”
 
From July 2006 through Jan. 2012, API Worldwide Holdings and its operators ran a Ponzi scheme promising huge returns on investments. Jeffrey L. Ripley, 61, of Sparta, and Danny Lee VanLiere, 62, of Grand Rapids, defrauded at least 140 victims of approximately $9 million by selling fake securities. The two men promised high returns but never delivered; victims were defrauded of about $3,000 to $600,000 each. 

Despite knowing that Ripley had been caught and punished for selling unregistered securities twice previously, it is alleged that Doctor and Kacos allowed, aided and abetted Ripley in operating a third scheme by acting as a registered agent and account holder for API Worldwide, Inc. Doctor and Kacos also allegedly opened financial accounts used to receive or liquidate cash and orchestrated third parties’ wiring investor funds to various foreign destinations so as to avoid detection. Both Kacos and Doctor invested money in API Worldwide, Inc.

Ripley and VanLiere targeted elderly investors with their scam, preying on elderly victims by convincing them to cash in certificates of deposit (CD’s) and other legitimate investments in order to invest the proceeds in API Worldwide. The two tracked maturation dates of CD’s for some victims to persuade the victims to transfer the funds to API Worldwide.  Most victims did not receive the principal or interest on their investment — although some did, those returns were derived from other investor’s funds, the trademark of a Ponzi scheme.

Sentencing for Kacos and Doctor is set for Jan. 27 before Kent County Circuit Court Judge James R. Redford.

In 2013, Ripley and VanLiere pleaded no contest to racketeering and selling unregistered securities, and were sentenced  to serve 6-20 years in prison, plus pay restitution.
 

––––––––––––––––––––
 Subscribe to the Legal News!
 http://legalnews.com/Home/Subscription
Full access to public notices, articles, columns, archives, statistics, calendar and more
Day Pass Only $4.95!
One-County $80/year
Three-County & Full Pass also available