ATM LEASEBACK SCHEMES-- any insight?

Stock and Bond Fraud, including Boiler Rooms / Pump and Dump Schemes, Mutual Fund & Hedge Fund Fraud, FOREX scams, plus Churning, Private Placements, Venture and Bridge Funding, IPOs, Viaticals Fraud, HYIP and Prime Bank scams, MTNs, Historical Notes, Recovery Schemes, etc. Includes the Jim Norman Project and the Michael Dotson Project and similar HYIP scams.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Dead Man Walking » Fri Apr 22, 2016 4:56 pm

I agree, if the bank settles only with the few who have filed then clawbacks would continue. But if the bank pursues an all inclusive settlement via the receiver in an effort to avoid the barrage of copycat suits, would the receiver continue to collect funds beyond the total required to settle up with all losers?

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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Judge Roy Bean » Fri Apr 22, 2016 4:57 pm

Dead Man Walking wrote:From what I can Gather the recent complaints filed are via private parties that have engaged there own lawyers.
The case on the surface sounds very destructive for the bank . If only 1/2 of the complaint is provable then the bank will not want this to drag out in the press (-).


It's too late for the bank to avoid the bad press, and now that the cases are filed, there are sure to be inquiries by any number of news outlets, particularly if the cases actually get to trial - which is highly unlikely.
Dead Man Walking wrote:Questions:

1.) If these cases settle will they become a precedent for the receiver to pursue like settlements or do you think the settlement would pull the receiver and his data into the mix and create a once and for all resolution for the Bank?????


When they settle these civil cases, any amounts (ultimately paid to the Plaintiffs by the bank's insurance company) will be confidential and there will be no admission of wrongdoing on the part of the bank. They will most likely hang everything on Fitzwilliam and toss him to the prosecutorial wolves then slap around their internal compliance auditors.

Dead Man Walking wrote:2.) If the bank settles with the receiver on all outstanding loses, by the investors, will clawbacks continue??


I don't see the Receiver doing anything more than asking for and getting cooperation from the bank in terms of gathering evidence as directed by the court and of course, providing the US Attorney's Office any useful evidence for prosecution of Fitzwilliam and/or his co-conspirators. As far as settling on all the outstanding losses, not a chance. Clawbacks, therefore, will continue.

Bank regulators are probably going to investigate and could impose fines/penalties, but those wouldn't contribute to the investor losses, either.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Judge Roy Bean » Fri Apr 22, 2016 5:30 pm

Dead Man Walking wrote:I agree, if the bank settles only with the few who have filed then clawbacks would continue. But if the bank pursues an all inclusive settlement via the receiver in an effort to avoid the barrage of copycat suits, would the receiver continue to collect funds beyond the total required to settle up with all losers?


There really is no path for the bank to an "all inclusive settlement" via the Receiver.

Victims, winners, losers, players, the bank, the bank regulators, prosecutors, co-conspirators, etc., etc., all have their own interests to pursue and some of them will conflict.

As to copycat suits, it really depends on the outcome of this first one and the investigation into Fitzwilliam.

You may be under the impression that the Receiver is going to pursue the bank as if it were one of the "winners" in the scheme; the bank's revenue and profits from the accounts and it's services are tiny in proportion to the amounts moved around among the parties. The Receiver's obligation is to recover monies from the "winners" which even though Fitzwilliam is alleged to be among, the bank itself is not.

The bank's exposure is limited to regulatory actions (by those who have specific authority to act) and civil litigation; even in the most egregious regulatory cases, criminal prosecution of a "bank" is limited to some number of culpable employees or officers.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby worried » Fri Apr 22, 2016 7:26 pm

Tednewsom wrote:I think there's already a case where a bank was held responsible, cited somewhere above. Madoff, maybe?


This was pretty recent, Sept of last year:
http://www.bizjournals.com/columbus/new ... 5m-as.html

The headline:
Huntington on hook for $72M as federal judge upholds ruling in Ponzi scheme case


An excerpt:
Huntington National Bank is alleged to have ignored signs of wrongdoing and continued to allow a related company, Teleservices Group Inc., to move money through its accounts.


It's not a done deal yet though:
"Huntington disagrees with this ruling and will move forward to appeal," spokesman Brent Wilder said in a separate statement. "We continue to maintain that this opinion exceeds legal precedent."


There's a link embedded in the story that I hadn't looked at before:
http://www.mlive.com/news/grand-rapids/ ... st_hu.html

If you read that story with more details, there's a wrinkle in that case:
Paraphrasing: Cyberco (the ponzi scheme) borrowed money from Huntington bank while using the bank for it's false business (something about getting investor money to buy computers,.. of course no computers were bought)... At some point, Huntington Bank decided they'd had enough and told Cyberco to go somewhere else, but FIRST, they'd have to pay off their debt... with ponzi money... that's "fraudulent transfer"...

The total award was $72M + $9M interest, the article doesn't say if that was the amount of the debt that was paid off or not... maybe it was. That would make that case different from the NASI-CNB case based on the info we've all gotten 2nd and 3rd hand here.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Dead Man Walking » Fri Apr 22, 2016 8:34 pm

The investors who have filed the lawsuits / claims could be getting a sum of money from the bank via a settlement, that we can assume. Would they also be entitled to the proceeds that the receiver recovers from clawbacks.

Another words can they double dip on both sides of the watering hole????

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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Judge Roy Bean » Fri Apr 22, 2016 10:07 pm

Dead Man Walking wrote:The investors who have filed the lawsuits / claims could be getting a sum of money from the bank via a settlement, that we can assume. Would they also be entitled to the proceeds that the receiver recovers from clawbacks.

Another words can they double dip on both sides of the watering hole????


IMHO, yes. Given that recovery will probably be pennies on the dollar it is predictable that net losers will seek deeper pockets if they can find a way over the contributory negligence hurdle.

But this is a very complex legal area, and as I've advised people repeatedly, every situation is different and every participant should get competent legal and tax advice for their specific case.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby worried » Fri May 06, 2016 7:12 pm

A new Receiver report is out at: http://www.nasi-receivership.com/court-documents/

Also, the Receiver is going after CNB!

The Receiver has collected $14M with another $4M in the pipeline, that's approaching 15%. He got ~$400k (net) from the sale of Gillis' house (apparently this was ordered as restitution, I guess we don't get to know directly what was ordered for restitution :-( ). There are still all those Oasis assets to recover and sell off as well... then there's CNB... It will be interesting to see what the claim ($) against them will be and how it ends up...
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby worried » Mon May 09, 2016 6:29 am

It's going to take forever to get more information on the case against CNB. Many of the posters here seem to have some bank experience. So, according to the complaint, over $300M of NASI money flowed through CNB. So, how much money would CNB have actually MADE as a result of that flow? I assume that the Receiver will ask for at least that much. Then, I think some punitive damages are at least obligatory. The question is how much for both? .... I'm sure someone here will hazard a guess or two?... and how long this might take to play out?...
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby notorial dissent » Mon May 09, 2016 7:36 am

When they first started talking about "bank" I wasn't sure who they were ultimately talking about, now I am, and VERY interesting. CNB was/is a VERY big bank, and got lots bigger when it got swallowed, lots of assets, and lots of lawyers. Also lots of not wanting bad PR. So we come back to the "people at the bank". If this were just a little local bank the bank itself could be on the hook for a great deal, as it is, it now looks like there was someone, or several someones in the local branch/office who was more or less in business for themselves. Chances are, if they were playing games with the boys, they were also playing with others as well. Good and bad. My supposition, is that the bank was big enough, and they were highly or properly placed enough to play games with the money and not get caught. There comes a point where a bank is both big enough and still small enough that an individual, or in this case individuals it seems, can get away with what is essentially money laundering and theft without getting caught. i'm sure it all looked eral good on paper and on the balance sheets. The accounts they were running were apparently not big enough to be looked at or considered out of the ordinary for that part of CA and that bank, and that was what they were counting on, that and they were in a position to keep it from happening. My supposition is that the bank, and probably the Fed and possibly state regulators, at this very moment are doing a fine toothcomb audit of that branch, and that more dirt will rise to the surface. The people behind the scam are the ones ultimately liable, but the bank has a responsibility to watch its officers and agents, and here they obviously fell down, hard. There will be insurance covering some of this, although probably a good deal will come out of the bank's oops acct. How much depends on what they find and how much can be proven, and more importantly how bad it looks, and it usually doesn't have to look very bad, but I don't expect it to happen quickly, unless the bank records are clearer than NASI's were. I would suspect at this point that ANY NASI transaction will now be in the suspect category until proven otherwise, and this could possibly open a whole new collection of doors to come knocking on. Whatever the outcome, they won't want to shell one dime more than they have to. My personal suspicion is that there are a number of bank officers no longer at that branch as a result of this.

On another front I see that they have now pretty much determined that Oasis was just a front for NASI and all their assets were really NASI assets. Getting that property back and the books on it straightened out is going to be an expensive mess i think.

If I read the report correctly it also looks like a good chunk of change went directly to FD as well, where I would bet it promptly evaporated, as have all the other investments in FD.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Dead Man Walking » Mon May 09, 2016 3:19 pm

As I suspected the receiver smelled fresh blood and is going after the bank!! How could they not??
IMHO this matter, with the bank, will disappear fairly soon with a behind the scene settlement. Will be interesting to see
if they can keep it as an undisclosed amount due to the Receiver's filing of updated reports, to the court ,that involve amounts collected etc.

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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby notorial dissent » Tue May 10, 2016 8:30 am

One way or another the bank has some level of culpability and that being the case they are going to want to limit their exposure, in all senses of the word. The likelihood of the bank ever going to court though is like slim and none, unless their loss prevention and upper management are particularly dense, and nothing I've seen indicates this, they will not allow that to happen, and which means they will make a relatively good faith at making things whole, and you can bet there will be a confidentiality (ironclad)agreement with the bank admitting no liability in lots of fancy words and phrases, the larger the volume of words and the fancier the phrases the bigger their exposure, which is a good place for the "net losers" to be in. It will not happen over night though as they have to deal with state and federal examiners, and I'm sure the IRS will be lookign as well, so it could be quite a while. I remember one financial audit I lived through, as an employee, that lasted between six and eight months as I recall.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby webhick » Tue May 10, 2016 6:57 pm

I know we've moved on from this, but I'm trying to catch up the blog now that I've got a bit of time to do so.

I've got a quick question on restitution. It states:

JOEL BARRY GILLIS and EDWARD WISHNER are jointly and severally liable to pay restitution in the above-entitled matter in the amount of $124,542,945.55


I take that to mean that the total restitution between them is $124m, not that they each owe $124m for a total of $248m in restitution. Am I reading that right?
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Judge Roy Bean » Tue May 10, 2016 7:10 pm

webhick wrote:I know we've moved on from this, but I'm trying to catch up the blog now that I've got a bit of time to do so.

I've got a quick question on restitution. It states:

JOEL BARRY GILLIS and EDWARD WISHNER are jointly and severally liable to pay restitution in the above-entitled matter in the amount of $124,542,945.55


I take that to mean that the total restitution between them is $124m, not that they each owe $124m for a total of $248m in restitution. Am I reading that right?


You are correct. Between them, they are responsible for the $124m - and it doesn't matter how it's divided.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby Dead Man Walking » Fri May 13, 2016 2:47 pm

Potato / Patato the $124,000,000. will never be realized from the likes of the Gillis and Wisher duo no matter
how you split the number. Zero times Zero divide by Zero plus Zero equals Nada !!!!

The two bottom feeding scum bags will be lucky to see the daylight beyond that of the prison walls that us tax payers are
paying for.

Both are fairly un-healthy and up there in years.

F--k um both !!

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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby webhick » Sat May 14, 2016 5:04 am

Judge Roy Bean wrote:You are correct. Between them, they are responsible for the $124m - and it doesn't matter how it's divided.


Thanks.

I'm muddling my way through summarizing the class action (the one filed in March)...and sensational isn't the word for it. It read like the legal-ly portions of Drop Dead Diva. That's right. It sounded like it was written by a model who died in a car accident and then hit the "return" key on a keyboard in heaven so she could get sent back to Earth and ended up commandeering the body of a brilliant lawyer with an average body type. Do not watch this show. Do. Not. Watch. This. Show.

Okay, that was harsh. Maybe I'm tired but the omniscient narration really got to me. Especially when there's a contradiction. For instance, in the initial complaint, states:

Betty Saleh was employed as a licensed investment advisor at UBS PaineWebber (“UBS”) from 1991 to 2002, at Wachovia Securities (“Wachovia”) from 2001 to 2004 and finally Wedbush Morgan Securities (“Wedbush”) from November 2004 until June of 2009 when she was terminated for securities fraud and then permanently barred by the regulators for willfully violating the securities laws.


So, Betty worked at Webush until she was fired in June of 2009.

Then, on page 19, line 22:

On September 21, 2009, the Wall Street Journal published an article about the arrest of two men in North Carolina charged with stealing $80 million from investors by selling them 4,000 hantom ATM machines which were leased back to investors, just like the NASI scheme. Betty Saleh received the article while employed at Wedbush, which subscribes to the Wall Street Journal.


How did she receive that article while employed at a place from whence she was fired like 3 months earlier? I'd like to see them prove that. Really would. And you can't submit evidence from an alternate timeline where she saw the article and then used a time machine to travel back to June 2009 where she did something stupid and got her original self fired. Paradoxes aren't admissible in court.

And it's not a typo. They included the article in their amended complaint and the date is indeed September 21, 2009. Le sigh.

At least the amended complaint looks less like it was written for ratings and more like it was written for a real docket. Looking forward to it, really.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby wserra » Sat May 14, 2016 4:30 pm

Dead Man Walking wrote:divide by Zero


Bzzt.

webhick wrote:And you can't submit evidence from an alternate timeline where she saw the article and then used a time machine to travel back to June 2009


Maybe you can, if you divide by 0. Or if you drive the Enterprise in circles at warp 27.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby webhick » Fri Jul 29, 2016 5:37 am

The receiver is now suing CNB! You can read the complaint on his site here.
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby The Observer » Fri Jul 29, 2016 4:03 pm

Well, Fitzwilliam may be the one source who had the ability to move assets for Joel and Ed out of the NAS accounts, given his wife's sordid background in finance. So this re-opens Ted's theory about there being more money out there. But I am wondering why the state is not moving against these two criminally?
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby notorial dissent » Fri Jul 29, 2016 4:49 pm

I am kind of curious as to why they filed in state court, but IANAL so they may well have had their reasons, and CA law may be in their favor. Adding the bank(s) and the two prime movers at the bank will go a long way towards recouping though. I am still interested to see what the records show. If they were at CNB the whole time, it should all be there to hang them out to dry. If they can prove their allegations, and I suspect they can or they wouldn't have taken this step, then the officers involved, and the bank and parent bank are going to be on the hook big time. I don't know if they will get the payout they are asking for, but again being CA and the nature of the act, it is a good possibility. From my armchair view and past experience and knowledge, if the accounts had been there that long, and their internal control depts noticed it and then let is slide, and thgy had a bank officer running interference for them on both sides, public and internal, they are as they say in DEEP KIMCHI. The bank(s) will try and say it was a bad unauthorized act by a rogue officer, but that won't wash either legally from what I can see, or regulatorily. Can you say big time audit from the FEDs, and probably the state as well, and then lots and lots of fines. I am a little surprised that there hasn't been any criminal action, but that can take time for the Comptroller, Treas, IRS, and FBI to all get their oars in the water. I don't see it not coming, just no idea when. I've known cases where it took years before they acted even though they had good information. Depends a lot on motivation as much as anything else. Gonna get interesting down the line though. On the other hand, this could be really good news for the investors. Fun times ahead.

So, webhick, am I to assume from the CA court filing that the Receiver has finally taken control of the Oasis entities as well?
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Re: ATM LEASEBACK SCHEMES-- any insight?

Postby worried » Fri Jul 29, 2016 8:48 pm

Great news all around... the 8th receiver report is on the receiver's website (nasi-receivership.com). He's collected over $20M(!!) now with 60 demand letters still outstanding... The CNB story is very satisfying, so far, we'll see how it pans out, but there may be some substantial relief for some of the hardest hit victims out there.... You know, I feel kind of sorry for people like Gillis, Wishner, Fitzwilliam, they've spent their lives worshiping at the alter of $$, missing out on real life. Gillis and Wishner are getting a taste of real life now, and Fitzwilliam and others will follow soon I hope.
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