If I mention the name Bernie Madoff, what words come to mind? Probably thief, criminal, felon and crook are on the short list. For most people the name Madoff is synonymous with the words “Ponzi scheme”. A Ponzi scheme, named after one of the first mass defrauders Charles Ponzi, is a fraudulent investment operation where returns on someone’s investment are paid by other investors rather than by a real or genuine profit sharing scheme.
Ponzi schemes can get pretty intricate but to put the crime in simpler terms, Ponzi schemes are complex forms of theft or embezzlement. So what’s the difference between theft and embezzlement? Embezzlement is a white collar crime, with the person usually stealing from his employer or other investors. Embezzlement is misappropriation of monies that you are entrusted with.
For many years the legal system was pretty lenient on white collar crimes such as embezzlement and money laundering, however with the major impact that criminals like Bernie Madoff have had on the economy and thousands of individuals, these crimes are punished more severely today. Listed below are five of the most famous embezzlement cases in the US and the prison sentences that were served.
Madoff was arrested in 2008 and the word Ponzi became widespread throughout America. Mr. Madoff was an investment advisor that was found guilty of 11 federal counts of fraud, including securities fraud, investment advisor fraud, false filings and money laundering. Madoff’s Ponzi scheme bilked thousands of investors of an estimated amount of $65 billion. In June 2009, Madoff was sentenced to 150 years in prison. As of March 2014, approximately $5.87 billion has been distributed among the victims of Madoff’s Ponzi scheme.
McCauley’s name might not ring a bell but he is the half-brother of famous comedian Dane Cook. Darryl McCauley was also the comedian’s business manager and used his position as both a family member and business man to steal millions of dollars from the star. McCauley plead guilty to 27 counts including larceny, forgery and embezzlement and faces 5-6 years in state prison with 10 years of probation and must make restitution to Dane Cook.
In 2008, Omar Siddiqui was the vice president of operations and merchandising for the electronic retailer Fry’s Electronics. Siddiqui set up a dummy company that received illegal kickbacks totaling over $80 million dollars. Siddiqui continued embezzling money to pay off heavy gambling debts to several casinos. Siddiqui was sentenced to 6 years in federal prison and has been ordered to pay $65 million dollars in restitution.
Lay was the founder, CEO and chairman of Enron and is infamously known for his role in corporate abuse and accounting fraud with the company which cost shareholders nearly $11 billion dollars. Enron became one of the largest sellers of natural gas, however years of unethical accounting practices resulted in the company filing for bankruptcy. Kenneth Lay was facing up to 45 years in prison plus monetary fines, however he died before sentencing.
Once a prominent financier and professional sports sponsor, Stanford was the owner and CEO of the Stanford Financial Group of Companies. The SEC launched an investigation in early 2009 to find that a massive ongoing fraud involving over a $8 billion dollar Ponzi scheme. Allen Stanford was charged by the SEC and ultimately convicted of fraud and numerous violation of US securities law. Stanford is currently serving a 110 year prison sentence.
Unfortunately, the restitution and the funds may never get back to the victims in some of these cases. The ripple effect of these crimes are vast and far reaching. The government and trustees in these cases continue to try to find hidden funds, and find hidden assets that can be repaid to the victims of these crimes.
Click on a star to rate it!
/ 5. Vote count:
Let us improve this post!
Thanks for your feedback!
Fill out the form below to recieve a free and confidential intial consultation.
Click here for important legal disclaimer.
10.0 Superb Rating
AVVO Criminal Defense
AV-Highest Rated Preeminent Lawyers
Nation's Top 1% Attorney
National Association of Distinguished Counsel
Criminal & DUI Defense
Top 100 Trial Lawyers
American Trial Lawyers Association
Client Satisfaction Award
American Institute of DUI / DWI Attorneys
Top 100 Lawyer
American Society of Legal Advocates
Top 10 DUI/DWI Law Firm
American Institute of DUI / DWI Attorneys
National College for DUI Defense
Top 10 Attorney
National Academy of Criminal Defense Attorneys
DUI Defense Lawyers Association
Lifetime Charter Member
Best Attorneys of America
American Bar Foundation
Arizona Trial Lawyers Association
American Association for Justice
Arizona Attorneys for Criminal Justice
Superior DUI Attorney
National Advocacy for DUI Defense
Member Since 1989
American Bar Association
Better Business Bureau