A Comic Book Ponzi Scheme
Three men were sent back to federal prison after they concocted a Ponzi scheme — in prison — that promised lucrative returns through the distribution of comic book rights. Daniel Parrili, John Lauer, and Christopher Anderson met in a Wisconsin prison where, unsurprisingly, they were currently serving time for fraud-related charges.
After their release from prison, the trio formed Sundown Entertainment Inc. (“Sundown”), which purported to specialize in the distribution of film and comic-book rights. Potential investors were told that their investment would be used to purchase the rights to old film footage that then would be used to produce and distribute movies and documentaries. Sundown lured investors by promising returns on short-term investments of up to 150%. In total, Sundown raised more than $7 million from over 150 investors.
While Sundown did actually engage in comic book production, the resulting revenues were not nearly enough to make the promised returns to investors. For example, one two-month period resulted in $8,000 in legitimate revenue — and $1.7 million in new investments. Yet, instead of informing investors of the situation, Sundown continued to solicit new investments.
In addition to prison time, each of the men was ordered to pay restitution to scheme victims.
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Jordan Maglich is a securities attorney with Wiand Guerra King P.L. in Tampa, Fla. He also serves as the editor and founder of Ponzitracker, an Internet blog that tracks the proliferation of Ponzi schemes across the United States.