CFTC Charges Two In Alleged Calif. Ponzi Scheme

May 25 2010 | 11:43am ET

Federal regulators say they have broken up yet another multi-million dollar Ponzi scheme, this one passing itself off as a successful commodity trading adviser.

The Commodity Futures Trading Commission has charged a pair of California men with defrauding investors in their New Golden Investment Group of about $3.65 million. Promising clients—some 165 of them, primarily Spanish-speakers in the Los Angeles area—that they’d double their money investing in oil, gold, silver and other commodities, Ruben Gonzalez and Jose Naranjo allegedly pocketed much of the money, never actually buying a single contract.

According to the CFTC, Gonzalez and Naranjo fit the Ponzi schemer cliché, spending client money on such necessities as a luxury car, as well as plane tickets and their mortgages.

In addition to the CFTC charges, Gonzalez, who was already jailed on illegal immigration charges, has been hit with criminal mail and wire fraud charges.

The regulator has already won an emergency freeze of Gonzalez and Naranjo’s assets, as well as those of West Covina, Calif.-based New Golden. The CFTC is seeking the return of ill-gotten gains, restitution and civil monetary penalties.


In Depth

Q&A: TCA Fund Management's Bob Press on Small-Cap Private Equity

Aug 25 2016 | 8:55pm ET

The emergence of private credit as a replacement for traditional bank financing...

Lifestyle

Kiawah: Island Reversal

Aug 24 2016 | 9:59pm ET

Looking for real estate investments but the typical real estate fare isn’t cutting...

Guest Contributor

Old Hill Partners: Embrace Illiquidity

Aug 9 2016 | 2:39pm ET

The age-old financial concept that higher yields are the result of higher risk and...