11/24/2010

News / $100 Million Ponzi Scheme Indictment Returned

JACKSONVILLE, FL—United States Attorney Robert E. O'Neill and James Casey, Special Agent in Charge, Federal Bureau of Investigation, announce the unsealing of a 14-count indictment charging Lydia I. Cladek, of St. Augustine, Florida, with wire and mail fraud and conspiracy to commit wire and mail fraud. Cladek faces a maximum penalty of 20 years in federal prison for each count and a $3.5 million fine. The indictment also notifies Cladek that the United States is seeking the forfeiture of specific assets, including oceanfront property, jewelry, and artwork which are alleged to be traceable to proceeds of the offense. The indictment also notifies the defendant that the United States is seeking a money judgment in the amount of $113,235,968.02, which represents the value of the proceeds of the charged criminal conduct.

According to the indictment, Cladek was the president and sole shareholder of Lydia Cladek, Inc. (LCI), an investment company involved in the purchase of high-interest motor vehicle retail installment contracts. It is alleged that Cladek encouraged investors to loan money to LCI to be used to purchase these high-interest notes with Cladek guaranteeing a return rate of 15 percent to 20 percent on the investment. Cladek would then issue a promissory note secured by the vehicles and the car notes. According to the indictment, Cladek used these funds to support her lifestyle, to acquire property, and to repay other investors to conceal her fraudulent use of the funds.

An indictment is merely a formal charge that a defendant has committed a violation of the federal criminal laws, and every defendant is presumed innocent unless, and until, proven guilty.

This case was investigated by the Federal Bureau of Investigation. It will be prosecuted by Assistant United States Attorney Jay Taylor, Jacksonville Division.

http://jacksonville.fbi.gov/dojpressrel/pressrel10/ja112310.htm

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