Businessweek article about Derek Elliott's USD 170M Ponzi scheme
Puerto Plata, Dominican Republic - Here in Puerto Plata, on the northern coast of the Dominican Republic, world-class opulence and wretched poverty are neighbors. Barefoot children mill among the shanties that dot the inland hills, while down on the coast, Americans enjoy Lobster Thermidor and candied papayas at lush resorts. Miami is just 90 minutes away by plane, New York a tad over three hours.

The proximity to the U.S. has been convenient for Michael Diaz Jr., a Miami lawyer whose team of investigators has been making frequent trips to this 517-year-old former Spanish slave colony. Diaz is representing U.S. investors who say they were burned in a $170 million Ponzi scheme. The plaintiffs allege that a pair of Canadian real estate developers, Frederick C. Elliott and his son, Derek, used their money to pay back earlier investors in a Puerto Plata resort and to fund shopping sprees and vanity projects. The investors are suing to get their hands on the Elliotts' assets. Meantime, the Securities & Exchange Commission is looking into the Elliotts' dealings, according to people familiar with the matter, though no criminal charges have been filed. The Elliotts declined to comment.

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Go back | Date: 21 Dec 2009
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