SEC Nabs Another Ponzi Perp

The Securities and Exchange Commission has announced another foiled Ponzi scheme, this one a $50 million fraud allegedly perpetrated by Pennsylvania resident Joseph S. Forte.

The SEC -- under fire for missing red flags and revelatory complaints in the case of Bernard L. Madoff Investment Securities -- seems to be making Ponzi perpetrators more of a priority. A couple of weeks after Madoff's fraud was first uncovered, the SEC stopped a $23 million Ponzi scheme that targeted Haitian-American investors.

But it wasn't just Madoff that focused the SEC's lens on this popular type of scam. Although the SEC didn't report any Ponzi-related arrests from January to July of last year, six scams -- not including Madoff's or Forte's-- were thwarted by the agency. One bilked investors of $25 million and another netted $30 million. One in early October raised $60 million, while a September arrest revealed a $52.7 million scam. In the first Ponzi-related arrest of the year, in August, the SEC found that Wextrust Capital made off with $255 million from 1,200 investors.

And of course, there are many other types of fraud.

In Forte's case, he is charged with operating a Ponzi scheme in which he fraudulently obtained approximately $50 million from as many as 80 investors through the sale of securities in the form of limited partnership interests in his company, Forte LP. He admitted to federal authorities in December that it was a Ponzi scheme, according to the SEC's complaint. 

It is important to note that all of these thefts combined do not come close to the $50 billion Madoff made off with. The question stands: how did such a gigantic scam go undetected for so long? But with these recent arrests, those in the business of fraud may want to ditch Charles Ponzi in favor of a new idol.