ATM LEASEBACK SCHEMES-- any insight?

[worried]

I read most of the files webhick posted online (thank you webhick!)... boy, Joel and Ed DID get off light... Has anyone seen the extensive report that shows all the payments from NASI to Joel, Ed, and OTHERS?! NASI's bank account was treated as a personal bank account for several people. Joel and Ed were driving $1000/mon cars, medical bills were being paid, trips abroad, stays in fancy hotels, hardly a restaurant bill under $100, etc... and that's just 2008-2014... Oh! and Mark Soffa (of Fuel Doctor fame) is implicated as well (got paid as a salesman!). ... So,... Notorial and Observer were right it seems, they WERE just brazenly skimming $millions off the top. There's still a bunch missing, but those payment reports give a good idea where a bunch of money went.

So, Joel and Ed's lawyers did a good job. They got busted in Aug 2014 and they won't go to jail until a few days after Christmas 2015.

It occurred to me that the NASI Loss Analysis was missing something (it's too late now though):
Consider 'winners', what if you were a 'moderate' winner? You WERE feeling pretty good about yourself, your decision to invest in this secret NASI deal is working out REALLY well, you're feeling very confident about your future and feel like it's time to really enjoy life. After all, you deserve it right? You had the 'smarts' to get in on the secret deal, right? So, you go ahead and take some nice trips, buy yourself some nice toys, renovate the house, buy some things for your family ('spread the love'), etc.... So, you got your 'principal investment' back and more, but you've been spending it (not saving) thinking that the NASI investment IS your 'savings'.... until POOF!... it's all gone. Your savings is gone AND you now know don't have the income your new lifestyle had become accustomed to... Maybe you're not being sued by the Receiver for clawbacks because you're too small to go after, but you're still a 'LOSER'. ... So, I would consider that Loss Analysis of 1300 people / $125M to be a LOW estimate.

I said it before, I consider all those character reference letters to be damning indictments of the true depravity of both those guys. They are the testimony of dozens of people of just how free Joel and Ed were with other people's money in seeking their own gratification in terms of living the fantasy life they wanted. Sure, that life didn't include driving Lamborghinis, but, it was still a sick, twisted, fantasy life funded by other people's life savings.

I felt disappointed that they weren't told to be ready to go to jail YESTERDAY, that they got one more Christmas at home with their biggest victims. That is sad. They got a grandkid to write a character reference (with help I'm sure)!... sick...

[Lost Income]

The sentence does demonstrate that they are recognized as criminals not nice guys, so now lets see if our legal system is capable of recognizing the monetary benefits enjoyed by these criminals and forcing an appropriate restitution amount. Now that the Joel & Ed know for sure they are slated to spend the balance of their active days in jail, maybe the lawyers still being being paid with stolen money can negotiate lesser jail time in return for Joel & Ed returning enough money?

[The Observer]

...[L]ets see if our legal system is capable of recognizing the monetary benefits enjoyed by these criminals and forcing an appropriate restitution amount. Now that the Joel & Ed know for sure they are slated to spend the balance of their active days in jail, maybe the lawyers still being being paid with stolen money can negotiate lesser jail time in return for Joel & Ed returning enough money?

Very unlikely for any of that to happen. As has been pointed out many times the monies invested in this scheme were paid out to the investors and what was left, most of it was likely skimmed by Ed and Joel - as is true of all Ponzi schemes. If there were a time that Ed and Joel were willing and able to negotiate a lesser sentence, that should have been before the sentence was handed down. That didn't happen. So you can either conclude that (a) Ed and Joel were not willing to turn over any monies in return for a lighter sentence or (2) Ed and Joel simply had nothing else to offer.

I mentioned earlier in this thread, in response to Ted's assertion that wealth cannot be destroyed, that indeed wealth can disappear and never be recovered. According to worried, there is evidence enough to show that Ed and Joel destroyed some of the investor's monies by spending it. This is typically what happens with Ponzi scammers, they blow it in on frippery and good times. Maybe the receiver will pursue some of the assets left behind by Joel and Ed -but that is going to be a drop in the bucket in comparison to how the monies got spent on non-recoverable items.

[Tednewsom]

Correction (since I was name-checked): If something is spent, the money has not been "destroyed," it has been transformed. It does not vanish, it simply becomes something else. Someone's life savings becomes a Gillis hot tub. Someone's kid's college fund morphs into a vacation in the Bahamas. It hasn't disappeared, it changed ("transformed," in physics terms) from cash in an envelope or numbers on a ephemeral bank account into luxury items, a glad-handing $10,000 donation to a pal, or a month of $200 dinners. I've never said or implied anything different. Sorry if you misunderstood.

"Irrecoverable" is something else altogether, but the parallel with energy remains. If you give Joel Gillis a chunk of your ice (filled with yummy nourishing atoms moving in slow motion) and he turns it into steam (with those same atoms now buzzed on espresso), it still exists, but he's pretty much assured it's irrecoverable to you.

[webhick]

We have the first sign of a trial in the clawback cases. 2:15-cv-06700, entry #17 on the docket says:

JOINT REPORT Rule 26(f) Discovery Plan ; estimated length of trial 1-3 days, filed by Plaintiff William J Hoffman.. (Attachments: # 1 Affidavit Proof of Service)(Hsu, Tim) (Entered: 11/09/2015)

[Hyrion]

We have the first sign of a trial in the clawback cases. 2:15-cv-06700, entry #17 on the docket says:

JOINT REPORT Rule 26(f) Discovery Plan ; estimated length of trial 1-3 days, filed by Plaintiff William J Hoffman.. (Attachments: # 1 Affidavit Proof of Service)(Hsu, Tim) (Entered: 11/09/2015)

Here's hoping they don't settle prior - otherwise we'll have to wait patiently for the next one.

[The Observer]

We have the first sign of a trial in the clawback cases. 2:15-cv-06700, entry #17 on the docket says:

JOINT REPORT Rule 26(f) Discovery Plan ; estimated length of trial 1-3 days, filed by Plaintiff William J Hoffman.. (Attachments: # 1 Affidavit Proof of Service)(Hsu, Tim) (Entered: 11/09/2015)

A trial? A trial? How can that be? There are no stinking trials when it comes to clawbacks. I know that because I have it on good authority from someone on this site who promised he would be feeding crow to anyone who was stupid enough to argue otherwise.

But you are probably on the right track regards the settlement happening. I am sure most attorneys in these situations will be looking to minimize the damage to the defendant especially if the receiver is feeling benevolent about determining how much to really recover.

Correction (since I was name-checked): If something is spent, the money has not been "destroyed," it has been transformed.

It's a semantic issue, and you are technically correct. But for all practical purposes, the money is gone and can't be retrieved, whether I consider it "destroyed" or you consider it "transformed."

[Lost Income]

No one knows how much cash or assets Joel & Ed current have or where it all is, and so far these guys have been able to pay for lawyers and accustomed to living expenses. So if our legal system believes these guys are criminals then the system should be capable of taking away what ever they can find to help pay back stolen money.

[The Observer]

So if our legal system believes these guys are criminals then the system should be capable of taking away what ever they can find to help pay back stolen money.

And that is the key - whatever the system can find that is allowed to be used for restitution. But as been pointed out before, you have to find it first. Ed and Joel being in prison will not make that any easier than before their conviction.

[Tednewsom]

From USDJ Email received this evening:

Defendants Joel Gillis and Edward Wishner were sentenced today (November 16, 2015) to the following:

Gillis: 120 months imprisonment, followed by 3 years of supervised release
Wishner: 108 months imprisonment, followed by 3 years of supervised release

A restitution hearing has been scheduled for February 1, 2016 at 10:00 AM before Judge Otero, courtroom #1, on the 2nd floor of the U.S. Courthouse, 312 N. Spring Street, Los Angeles, CA 90012. the notification system will be updated after the restitution hearing.

The court ordered the defendants to surrender to the custody of the Bureau of Prisons on December 28, 2015.

My initial reading of this only captured the word "months" and I thought, "Oh, yeah, perfect. They steal millions, ruin thousands of lives, and get a couple of months." But wait. "120 months" is 10 years in the slam; 108 months is nine years. Not bad at all... for a start.

[Lost Income]

So if our legal system believes these guys are criminals then the system should be capable of taking away what ever they can find to help pay back stolen money.

And that is the key - whatever the system can find that is allowed to be used for restitution. But as been pointed out before, you have to find it first. Ed and Joel being in prison will not make that any easier than before their conviction.

Your right. I'm assuming that the legal system will take their house, cars, anything they can find to reverse a reasonable percent of the damage done to victims. Frankly, two old guys having to give up everything and live on the street, seems more punishing to me than our tax dollars giving them a warm bed, meals, and medical within the prison system.

[Hyrion]

So if our legal system believes these guys are criminals then the system should be capable of taking away what ever they can find to help pay back stolen money.

And that is the key - whatever the system can find that is allowed to be used for restitution.

Frankly, two old guys having to give up everything and live on the street, seems more punishing to me than our tax dollars giving them a warm bed, meals, and medical within the prison system.

And then one considers that people in that kind of situation - living on the street and desperate to act on a million years of evolutionary survival instinct - commonly resort to crimes in order to survive.

Most times theft, sometimes murder.

So if they're made pauper - and one of them commits murder for a watch - how does that cost to Society in the form of the prison system compare for you at that point?

[The Observer]

Indeed, there is a significant difference between punishment and retribution.

[Hyrion]

Indeed, there is a significant difference between punishment and retribution.

I'm not even really thinking of the impact of either of those. I'm simply considering cause-and-effect.

I'm not in position to make the determination - but let's pretend I was and I choose a path where the individual was released as a pauper knowing that could result in the person inadvertently killing someone for their watch so they could have a meal. Let's say that potential actually happened.

I'd share in the responsibility in an ethical/moral sense for the death of that innocent.

That is not something I want on my conscience when I'm laying on my death bed thinking over my life. Personally, I'd rather pay as a member of Society for the individual to have their basic necessities of life served up in prison - then to pay as sharing in the responsibility of the loss of human life.

I understand some people place a very low (perhaps no) value on human life. I place an immeasurable value on it because I value my life and every other human being has as much value to their life as I have to mine. That concept - that every human is equal in the sense of rights and other factors like value of life - is the core base for a true Civilized society.

And... in those cases where we need to punish someone because they've harmed others - it doesn't mean we can't honor the rest of their rights even while we "take away" a right in the form of punishment - freedom of prison is lost when we're convicted of a crime punishable by a prison sentence for example. We shouldn't let those who don't honor the rights of others equal to the rights of themselves drag us down to their level.

[Lost Income]

These crooks have no idea of the damage they have caused older people in retirement whom can't easily get jobs, by selling them on investing with NAS instead of the traditional roller coaster stock bond mkts (I've heard this sales pitch from Joel many times). So lets see how much of the stolen money our legal system lets them keep.

[Hyrion]

These crooks have no idea of the damage they have caused older people in retirement whom can't easily get jobs, by selling them on investing with NAS instead of the traditional roller coaster stock bond mkts (I've heard this sales pitch from Joel many times).

Agreed - which is why I'm of the opinion that 10/9 years is likely too short - but I also recognize I'm not privy to all the facts that resulted in the Judge selecting that time frame. And I'm definitely not wise enough to be able to say what would be appropriate.

So lets see how much of the stolen money our legal system lets them keep.

Therein lies the problem: the legal system needs to properly link the associating assets before recovering said assets - otherwise they risk taking money that wasn't actually part of the situation - such as from another retired individual who had no role in the situation, a result that would be equally unjust as what Ed/Joel did.

It's not a matter of the legal system "letting them keep" the funds. It's a matter of the legal system properly linking the funds so that they avoid the result of one unjust action attempting to fix another unjust action. That's not an easy or simple task. And it's made that much harder because they are limited in how much of the estates assets they spend in order to try and recover further assets.

[Lost Income]

Given the rat holes and flaky accounting system the crooks created to hide money, and the amount of stolen money they spend, over 19 years, we shouldn't expect much realistic linking of stolen monies to assets. So it will be up to the legal system to guesstimate a logical restitution amount to take away from the crooks, based on a logical guesstimate for the amount of money stolen. Doubtful the crooks could even come close to paying enough back, if everything was taken from them that we know about. We've reached the point that it is what it is.

[The Observer]

I'm not even really thinking of the impact of either of those. I'm simply considering cause-and-effect.

So was I. The point being that retribution tends to be very short-sighted in terms of understanding the total impact of what you render upon the convicted. Thus, retribution is never as good as punishment is.

Doubtful the crooks could even come close to paying enough back, if everything was taken from them that we know about. We've reached the point that it is what it is.

But if it is any satisfaction, the crooks have definitely hurt their own families as well. I have had to deal with one person who was a relative to a principal scammer in a high-profile Ponzi scam. This person lost quite a bit, despite the fact they were not party to the scheme. They lost their home, personal effects, savings and much more due the restitution imposed by the court due to the fact that they had benefited from the scammer's skimming.

[Lost Income]

Yeah its bad that Joel & Eds families have to get hurt on this, but of course the victims families are suffering as well.

After 19yrs I wonder if their wives felt that this was a normal biz, or eventually figured out this was scam and too late to turn back?

[Hyrion]

Yeah its bad that Joel & Eds families have to get hurt on this

If their families are truly innocent with regards from whence the illicit funds came into their lives, then it is a pity they will get stung.

At the same time, it is Just to acquire the assets of those illicit funds if said assets can be linked to the proceeds of the crime and redistribute that to the victims.