You believed you were investing in a legitimate enterprise. The returns looked steady. Your statements showed consistent gains. Then everything collapsed.
The investment was a fraud. The returns were never real. The money was gone. If this sounds familiar, you may be the victim of a Ponzi scheme.
Ponzi schemes destroy life savings, retirement funds, and financial security. Haselkorn & Thibaut, P.A., operating as Investment Fraud Lawyers, represents Ponzi scheme victims nationwide. Our partners are former Wall Street defense attorneys. We understand the multiple recovery paths available, and we know how to pursue them.
Call 1-888-885-7162 for a free, confidential case review. We work on a contingency basis — no recovery, no fee.
What is a Ponzi scheme?
A Ponzi scheme is an investment fraud in which the operator pays returns to earlier investors using capital from newer investors. There are no real profits. The scheme depends on a constant flow of new money. When new investment slows, the scheme collapses.
The U.S. Securities and Exchange Commission, or SEC, prosecutes Ponzi schemes as securities fraud. The Financial Industry Regulatory Authority, or FINRA, can also hold brokers and firms accountable when they recommend or facilitate these schemes.
Signs you may be a Ponzi scheme victim
| Warning sign | Why it is a red flag |
|---|---|
| Consistently high returns with no down periods | Legitimate investments fluctuate with markets |
| Vague or secretive investment strategy | Operators hide the lack of real business activity |
| Difficulty withdrawing money | Redemptions threaten the flow of new funds |
| Pressure to reinvest rather than cash out | Keeping money in the scheme delays collapse |
| Unregistered investments or unlicensed sellers | Missing regulatory oversight increases fraud risk |
Famous Ponzi schemes and their impact
Ponzi schemes have caused billions of dollars in losses. The table below shows well-known examples and their reported scale.
| Scheme | Operator | Approximate reported loss | Outcome |
|---|---|---|---|
| Madoff Investment Securities | Bernard L. Madoff | $65 billion in reported fraud | Convicted; assets recovered through trustee liquidation |
| Horizon Private Equity | John J. Woods | More than $110 million owed to investors | SEC enforcement action; investor recovery claims filed |
| Broad Reach Capital | Brenda Smith | $63 million alleged Ponzi scheme | Federal arrest; SEC complaint |
How we build your Ponzi scheme recovery case
We start by tracing the money. We work with forensic accountants to identify how funds flowed, which parties received commissions, and where assets may remain. We then determine the best recovery forum.
Common recovery paths include FINRA arbitration claims against the broker or firm. SIPC claims may apply if the operator was a registered broker-dealer. Clawback actions may apply if you received payments before the collapse. Each path has strict deadlines.
What you can recover
Ponzi victims rarely recover everything, but recovery is possible. The amount depends on whether assets remain, whether third parties such as brokers share liability, and the forum used. We pursue every available path.
When a broker or firm recommended the scheme or failed to catch warning signs, FINRA arbitration may provide the most direct route to compensation.
Why choose our firm
We have helped Ponzi scheme victims pursue recovery for decades. Our 98% success rate reflects our persistence and our deep understanding of these complex cases. Because our partners were once Wall Street defense attorneys, we know how firms try to distance themselves from fraud. We also know how to hold them accountable.
Related practice areas
- Investment fraud attorney
- Private placement fraud lawyer
- REIT fraud lawyer
- Unauthorized trading lawyer
Frequently asked questions
What is the difference between a Ponzi scheme and a pyramid scheme?
A Ponzi scheme uses new investor money to pay earlier investors. A pyramid scheme relies on participants recruiting new members. Both are fraudulent, but the legal theories and recovery paths can differ.
Can I recover money if the Ponzi operator is in prison?
Yes, if other parties such as brokers, firms, or custodians share liability. We often pursue FINRA arbitration claims against the financial professionals who recommended or facilitated the investment.
What is SIPC protection?
The Securities Investor Protection Corporation provides limited protection if a registered broker-dealer fails. Coverage can reach $500,000 per account, but it does not cover market losses or fraud directly.
How long do I have to file a claim?
Deadlines vary by forum and state. FINRA arbitration has a six-year eligibility rule, but shorter statutes of limitations may apply. Contact us promptly.
What if I received some money back before the collapse?
You may still have a claim. Some payments may be subject to clawback in bankruptcy, but that does not erase the broker’s liability in arbitration.
How do I start a free case review?
Call 1-888-885-7162 or contact us online. The consultation is free, and we work on a contingency basis.
How Ponzi schemes are discovered
Most Ponzi schemes collapse when new investment slows or too many investors ask for withdrawals. Some are uncovered by whistleblowers, regulatory exams, or media reporting. In recent years, federal prosecutors and the SEC have pursued large schemes involving promissory notes, cryptocurrency, and private funds.
The sooner you act, the more recovery options remain. Assets may still be traceable. Claims against third parties may still be viable. Waiting can cost you the right to recover at all.
Recovery forums for Ponzi victims
| Recovery path | When it applies | Key consideration |
|---|---|---|
| FINRA arbitration | Broker or firm recommended or facilitated the scheme | Private forum; faster than court; limited discovery |
| SIPC claim | Operator was a FINRA-registered broker-dealer | Limited coverage; does not cover fraud losses directly |
| Bankruptcy claim | Scheme entity files for bankruptcy | May require returning prior payouts as clawbacks |
| Civil litigation | Third parties such as auditors or banks enabled the fraud | Can be lengthy and expensive; often contingency-based |
Why early action matters
Ponzi schemes leave a trail, but the trail gets colder over time. Assets are spent, transferred, or hidden. Witnesses move. Records are destroyed.
The sooner we begin, the more options remain.
Early action also protects your legal rights. FINRA and state deadlines can bar claims that are filed too late. A quick consultation costs nothing and can preserve your ability to recover.
How we coordinate with regulators
We monitor SEC and FINRA enforcement actions related to Ponzi schemes and broker misconduct. When a regulator files a case, it can produce evidence that helps our clients. We use public filings, settlement orders, and bar proceedings to support our arbitration claims.
This page is for informational purposes only and does not constitute legal advice. Past results do not guarantee future outcomes.