‘Mini-Madoff’ Arrested in $300 Million Suspected Ponzi Scheme
Spanish police said they arrested a foreign-exchange operator suspected of running a $300 million Ponzi-type fraud that may have affected at least 100,000 investors in Europe, the U.S. and Latin America.
The "mini-Madoff," dubbed in reference to jailed Ponzi con man Bernard L. Madoff, offered returns of as much as 10 percent to 20 percent monthly for investments in foreign currencies and instead used the money to buy real estate for himself and colleagues, according to a National Police statement today.
The man, German Cardona Soler, is 49 years old and a Spanish citizen, said a police spokeswoman who declined to be named, following agency policy. He was arrested in the Mediterranean city of Valencia. Two more people were apprehended and seven people were accused in relation to the suspected fraud, the statement said.
Accounts in 12 banks have been blocked and the titles frozen for more than 20 properties in Spain, the police said.
In Ponzi schemes, money from new customers is typically used to pay phony "returns" to earlier investors, giving the pretense that actual investments have taken place.
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