Accused Ponzi scheme operator Robert Van Zandt now has a $35 million civil suit on his back.
After allegedly bilking hardworking blue-collar workers out of their 401k savings and other retirement money, Van Zandt, the former proprietor of the Van Zandt Agency on Blondell Avenue, not only was charged with criminal fraud, but is also now the target of a $35 million securities fraud civil case.
Van Zandt was already facing multiple charges of securities fraud, money laundering and grand larceny for an alleged $4.6 million Ponzi scheme, after an investigation by state Attorney General Eric Scheiderman. Scheiderman announced on Thursday, May 17 that his office was filing charges in civil court that Van Zandt targeted clients of the tax prep agency to make high stakes bets on real-estate development projects he claimed to own or control, as well as in the stock market.
“Money laundering and securities fraud are serious crimes, and when people abuse trust built upon long-standing relationships to steal investors’ life savings, our office will prosecute civilly and criminally to the fullest extent of the law,” Schneiderman said.
According to Scheiderman’s office, Van Zandt allegedly abused knowledge of his tax preparation clients finances and targeted investors with little knowledge about financial markets to make the scheme work.
Van Zandt took people’s life savings in some cases, promising high rates of return, instead using later investors’ money to pay previous investors to stay one step ahead, or to pay his own gambling debts and other expenses, Attorney General Schneiderman said.
About 100 investors put up between $25,000 to $900,000 to his Van Zandt Agency, Schneiderman said.
According to a published report, Van Zandt allegedly “drove a Mercedes, wore a Rolex watch, sat behind home plate at Yankee Stadium and played golf in sunny locales,” alleged victims of the scheme stated.
According to some of the victims, Van Zandt said they should in all likelihood receive 7 to 12 percent a year in returns on investments.
Van Zandt’s attorney Michael Bachner said his client is a victim of partners, with the investments legitimate real estate deals that lost value when the market crashed in 2008.
A number of those who were bilked have also filed their own civil complaint for more than $4 million with the Financial Industry Regulatory Authority against MetLife Securities, charging the investment firm “failed to provide adequate and meaningful supervision over their branch office.”