Our Own Little Bernie Madoff Ponzie Scheme

Prospect Heights man charged in federal fraud investigation

View Comments (
)
|
Email
|
Print

    NEWSLETTERS

    AFP/Getty Images
    Bernie Madoff isn't the only one.

    Before Bernie Madoff, most people wouldn't have known a Ponzi scheme from a toaster.  But that's all changed since the New York financier ripped off hundreds of people in his $65 billion scam.

    The FBI today charged a local guy with a similar crime.  Frank Castaldi is suspected of operating a more than 20-year Ponzi scheme.

    Compared to Madoff, Castaldi, of Prospect Heights, is an amateur. 

    According to FBI information, he only took about $77 million from something more than 450 investors. He told them they'd get a 10 to 15 percent return on their money. That didn't happen, and it appears now that the jig is up.

    The 56-year-old is facing  two counts of mail fraud and one count of corruptly endeavoring to impede the Internal Revenue Service. U.S. Attorney Patrick Fitzgerald announced the charges.  Additionally, prosecutors are seeking forfeiture of about $31.6 million from Castaldi.

    A federal complaint was initially filed against the businessman in January. Today's announcement brings him closer to trial. If convicted, each count of mail fraud carries a maximum penalty of 20 years in prison and a $250,000 fine, dependent on the court's ruling.

    None of that will be much comfort to Castaldi's victims, the hundreds who purchased promissory notes from him and got little, if anything, in return.

    "None of us are 'big shots' with huge fancy houses and huge fancy cars," one victim wrote on the blog Topix.  "We are regular folks who live in regular houses in regular neighborhoods. We are people who simply trusted someone that we thought was really, really smart and knew a lot about investments."

    "Because of you we have lost everything; our cars, our homes, our security, our lives, our souls," another said.

    We've learned that that's how schemers work. Castaldi's victims followed the adage, "You've got to spend money to make money," only it didn't work out that way for them.

    A press release from the Department of Justice reminds us that "the defendant is presumed innocent and is entitled to a fair trial." 

    Right. Tell it to the judge ... and to the victims.