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Monex Grupo Financiero Customers Lose $40M in Alleged Ponzi Scam

Texas Brothers Sue Financial Services Company for $1.5M

After turning down a settlement that would have reimbursed them 60 cents for every dollar, brothers Jim and Ken Karger are suing Monex Grupo Financiero for the $1.5M they lost in an alleged decades-long Ponzi scam. This alleged scam not only defrauded them but also other expatriates living in the town of San Miguel de Allende resulting in a loss of up to $40M.

Mexico Daily News, which conducted an investigation into the allegations last year, found that the money was stolen from 150 Monex accounts held by expatriates, including retirees. 

Marcela Zavala Taylor, an English-speaking employee of the bank, is the one accused of bilking these investors. Zavala provided these customers with personal banking services and stopped responding to them after their money went missing.

While Monex Grupo claims it had nothing to do with the Ponzi scam and has filed a criminal complaint against Zavala, its expatriate customers are the ones who are dealing with significant losses. Unlike the Karger brothers, some of them have agreed to settle for much less than what they lost, even signing documentation clearing the Mexican bank of any blame.

Jim, who is formerly a lawyer from Dallas, now lives in San Miguel Allende. Ken, a retiree, remains in Texas.

Kargers Were Told Their Money at Monex Grupo Financiero Was in Dollars, Not Pesos  

The Kargers own a private lending business in San Miguel Allende. The city, which is 500 miles from McAllen, Texas, is a popular living destination for US ex-pats and retirees. The brothers contend that Zavala had told them their money at Monex was in dollars. 

They later found out that the funds had been in Mexican pesos. With the devaluation of that currency, this too has caused their money to be worth less.  

The brothers are hoping that a two-year law in Mexico that holds financial companies responsible for the actions of their agents and employees will help their investment fraud lawsuit. They have also set up a website, bancomonexfraud.com, about their case.

Texas Broker Fraud Lawyers Fighting for Retirees

Shepherd Smith Edwards and Kantas (SSEK Law Firm) represent investors who were harmed because of the negligent actions of brokerage firms and banks. Our elder investment fraud lawyers have recovered many millions of dollars on behalf of our clients through arbitration, mediation, and litigation. 

Contact our expert team of attorneys today for your free, no-obligation case consultation.

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