March 4, 2014 | 1 view
Schneider pleads guilty to $6.9 million Ponzi scheme
In U.S. District Court in Central Islip last Friday, Oceanside businesswoman Laurie Schneider pleaded guilty to one of seven charges of operating a Ponzi scheme that federal prosecutors said defrauded 30 investors out of a total of $6.9 million.
Schneider was arrested in 2010, four years after she began accepting money from investors seeking to earn profits in overseas machinery and equipment deals and real estate on Long Island. According to court documents, she used two shell corporations, Janitorial Close-Out City Corp and Eager Beaver Realty LLC, to steal money from them.
“Laurie Schneider played the part of a successful entrepreneur, willing to help others invest in equipment and machinery deals as well as Long Island real estate,” said Loretta Lynch, the U.S. attorney for the Eastern District of New York. “In reality, she was a con artist, using lies and false assurances to bilk unsuspecting investors out of millions of dollars. Schneider ran a classic Ponzi scheme, using investor money for her own selfish purposes. This office is committed to vigorously investigating and prosecuting individuals who are responsible for perpetrating financial crimes on the residents of our communities.”
According to court documents, in one scheme, Schneider told three of her victims, known as John Does 1, 2 and 3, that she had a contact, John Doe 4, who had strong business ties in China and would be able to purchase industrial equipment and machinery at wholesale prices. The machinery would then be sold at marked-up prices, returning all of the investors’ money and realizing a profit of as much as 60 percent. Instead of making any actual purchases, however, Schneider used investors’ money to pay off other investors, while keeping some for herself. She later admitted to having no contact in China.
Schneider pleaded guilty to one count of wire fraud for cheating an investor out of $290,000 in October 2007, and agreed to make restitution to all the victims in an amount to be determined by U.S. District Judge Denis Hurley. She will also forfeit $1 million to the federal government.