A former resident of Wellington, Fla., has been indicted for operating a $30 million Ponzi scheme that targeted investors in the Haitian-American community, prosecutors say.
George Louis Theodule, 52, has been charged with multiple counts of wire fraud, securities fraud and money laundering for defrauding thousands of victims, says U.S. Attorney for the Southern District of Florida Wifredo A. Ferrer.
Several years ago, Theodule was the defendant in a civil action filed by the SEC stemming from the same scheme that took place from 2007 to 2008. The SEC halted Theodule’s operation when it filed an emergency civil enforcement action against him and his companies.
The SEC’s complaint alleged that the defendants had raised more than $23 million from thousands of mostly Haitian-American investors through a fraudulent, unregistered offering of securities. The agency said he lost millions trading stocks and options through a network of purported investment clubs.
The SEC obtained a restraining order to halt the fraudulent activity, and thereafter a receiver was appointed by the United States District Court for the Southern District of Florida to identify and trace assets. A court judgment was obtained that enjoined him from further violations and ordered him to pay a total of more than $5.5 million disgorgement, interest and civil penalties.
The subsequent criminal indictment obtained by the U.S. Attorney’s office says Theodule induced individuals to invest money with his companies, Creative Capital Consortium LLC and A Creative Capital Concepts LLC. He told investors he would be able to double their money in 90 days, primarily by trading in stock options.
Only a small portion of investors’ money was placed into trading accounts, which invariably were depleted without showing any gains, the indictment charges. Instead, the money was used to repay early investors and for Theodule’s benefit, according to the SEC.
“This case provides an egregious example of someone exploiting the trust of members of their own community,” says Drew J. Breakspear, commissioner, Florida’s Office of Financial Regulation.