A former California broker has admitted to running a yearslong Ponzi scheme that prosecutors said stole at least $9.5 million from more than 93 investors, as ThinkAdvisor detailed.
In a statement, authorities said the fraud continued for years after his license was suspended.
What happened?
Edwin Emmett Lickiss Jr., 78, of Danville, California, admitted in federal court to wire fraud and money laundering charges, federal prosecutors in Northern California said. Prosecutors said the scheme ran from 1998 through September 2024.
Officials said Lickiss lured victims by promising "exclusive, safe, tax-free bonds," with some investments supposedly earning returns of more than 20%. According to prosecutors, he used his former firm's letterhead for fraudulent promissory notes tied to Foundation Financial Group.
Federal prosecutors described the operation as a classic scheme in which new money was used to pay earlier victims. Lickiss' victims were drawn from Danville and the nearby town of Alamo, the statement said.
Lickiss is scheduled to be sentenced Aug. 28. Prosecutors said he could face up to 20 years for wire fraud and up to 10 years for money laundering, along with substantial fines.
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The Securities and Exchange Commission has also filed related civil charges.
Why does it matter?
Prosecutors said the money was not being invested in secure bonds at all. Instead, funds from later investors were used to pay earlier investors, while some of the cash was diverted to home renovations, travel, vehicles, mortgages, and personal credit card bills.
ThinkAdvisor noted that Lickiss' indictment stated that the Financial Industry Regulatory Authority suspended him in 2014, and he lost his license in 2016. Yet authorities said he continued soliciting investors until about September 2024, per the outlet.
Schemes like these rip off investors and can cost them hard-earned savings. While the Bernie Madoff saga is the most infamous recent Ponzi scheme, there are countless versions of the scheme that are trying to lure in investors around the world today.
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