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Aequitas Ponzi Fraud Case Results in $234.6M Settlement

Investors who lost money after investing in Aequitas Management LLC, which is accused of running a $350M Ponzi scam, have arrived at a $234M settlement in their fraud case against EisnerAmp LLP, Deloitte & Touche LLP, TD Ameritrade, Duff & Phelps, Sidley Austin LLP, Integrity Bank and Trust of Colorado, and Tonkon Torp. The defendants are accused of playing a part in the plaintiff’s losses because of their purported involvement in the sale of Aequitas securities.

More than 1,500 investors collectively invested over $350M in Aequitas securities while thinking that they were backing trade receivables in healthcare, education, transportation, and other areas. This investor fraud case, Ciuffitelli et al v. Deloitte & Touche LLP et al, was brought as a proposed class action and filed over three years ago by claimants in Oregon and California.

Based on a complaint brought also in 2016 by the US Securities and Exchange Commission (SEC), Aequitas is accused of misleading investors about the extent their money became involved in for-profit education company Corinthian Colleges, which filed for bankruptcy in 2015. The regulator accused Aequitas of becoming a Ponzi scam after Corinthian failed, with the company continuing to sell securities for the purposes of paying back earlier investors and to support its executives’ expensive lifestyles.

The plaintiffs in this proposed action contend that the defendants helped enable the Ponzi scam by preparing sale documents for the Aequitas securities and letting audited financial statements be used as marketing collateral. While the investors are not accusing the defendants of doing anything wrong, they believe that the latter, through their roles, helped the fraud along and should therefore be found statutorily liable.

Despite settling, the defendants are denying any liability. They argued that not only was there any way they could have known about the fraud, but also they are calling to question the contention that they played a part in the selling of the Aequitas investments.

Aequitas Investor Fraud Lawyers
Our broker fraud law firm works with clients whose financial advisers and/or registered representatives recommended that they invest in Aequitas securities. Over the years, Shepherd Smith Edwards and Kantas, LLP (SSEK Law Firm) has found that filing your own claim with the help of an experienced investor fraud law firm increases your chances of maximizing your recovery. Contact us today.

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