Spanish police arrested a man suspected of running a $300 million Ponzi-type fraud in foreign exchange trading 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 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, 49, is 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 others were apprehended and seven people were accused in relation to the suspected fraud, the statement said.
In 2008, Spain’s market regulator warned investors against giving money to Panama-based Evolution Market Group Inc., doing business as Finanzasforex and headed by Chairman German Cardona Soler. The company offered investors 10 percent to 21 percent returns investing in foreign exchange, according to the investor warning. Spokesmen for the regulator and the police said they couldn’t determine whether they were the same man.
The Attorneys College in Madrid wasn’t able to say what lawyer may be representing Soler.
Accounts in 12 banks have been blocked and the titles frozen for more than 20 properties in Spain, 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.