Corporate & Securities Law

There has been an unprecedented number of investment frauds and Ponzi schemes recently, leaving thousands of victims in their wake.  In many of these cases, the investors fell victim to a type of fraud known as affinity fraud.

Affinity fraud refers to investment frauds that prey upon the innocent members of groups, such as religious or ethnic communities, senior citizens, civic organizations or professionals.  The perpetrators of the fraud first infiltrate the group and pretend to be an active member.  Thereafter, the perpetrators of the fraud gain the respect and trust of the other members of the group.

Once they have the trust of the group, the perpetrators begin promoting a fraudulent investment that seems to be worthwhile or legitimate.  In many cases, the fraudster is able to convince the leader of the group to endorse, and even promote, the investment on the behalf of the fraudster.

It is difficult for securities regulators or other watchdogs to detect and stop these frauds as victims tend to keep their losses secret and try to work it out within the group before alerting outsiders. 

In many cases, operators of Ponzi schemes use affinity fraud as their preferred method of obtaining new investor money, which is in turn used to make payments to earlier investors giving the investment that the illusion of profitability.  From there, the fraudsters lure more and more investors into the scheme, and lead an increasingly lavish lifestyle.  Ultimately, the scheme collapses and the investors lose most, if not all of their money.

Eccleston Law represents individual and institutional investors to recover their investment losses caused by securities and investment fraud. Our attorneys also help victims of Ponzi schemes pursue recovery by submitting claims with receiverships established by the SEC or by assisting victims with the filing of a Theft Loss Tax Deduction with the IRS.

If you have lost money through an affinity fraud or investing in a Ponzi scheme and would like to discuss your recovery options, please contact Jim Eccleston at the Eccleston Law Offices at 312-332-0000.