New York – The man some call Brooklyn’s Bernie Madoff is expected to be arrested soon on charges of defrauding hundreds of working-class clients in a $40 million Ponzi scheme, the Daily News has learned.
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Federal prosecutors and the Securities and Exchange Commission, after probing Philip Barry for more than a year, are expected to file criminal and civil charges, a knowledgeable source said.
“It’s going to happen sooner rather than later,” the source said.
Barry, who filed for bankruptcy protection last fall, is on the hook for millions in civil judgments and damages ordered by a judge presiding over a series of suits filed by former clients in Brooklyn Federal Court.
“I think a prosecution will be some measure of vindication for my clients,” said Edward Scarvalone, a lawyer representing three of Barry’s alleged victims who lost about $675,000.
Spokesmen for Brooklyn U.S. Attorney Benton Campbell and the SEC declined to comment. Barry could not be reached.
Over the past two decades, Barry promised clients a 12% annual return on their investments, court papers say. The scheme began to unravel in 2007 when investors tried to withdraw funds.
Authorities say Barry used the money to buy swaths of land upstate to develop. He then claimed nesting eagles prevented him from starting construction.
“There’s some truth to that, but the other reasons were he didn’t pay his taxes or the mortgage,” bankruptcy trustee Alan Nisselson said.
Because a guy takes money to invest upstate and promises return and doesn’t pull through means he’s Bernie Madoff. Madoff never made any investments with the money! This guy just had bad luck in what he invested in (that’s the risk taken when investing). It seems that anyone who opens up a investment co. and doesn’t pay decent returns will end up in jail in America.
Why is this a ponzi scheme?
If they would have been able to develop the land they would have made money. This is a true investment. If something doesn’t go their way, they sue. If they would have made money (and 12% is not out of the ordinary), everything would be fine. They would even congratulate themselves on what a great investment they made (how smart they were)
why not just invest with the banks mutual funds? because these guys were not looking for 12%, they were looking for 25%. maybe i should sue my bank for not investing in the right places?
“Barry promised clients a 12% annual return on their investments, court papers say”
If this is true, his investors are fools and they should also be held accountable. If it is true, this guy is a crook. However, the investors should realize that a person who tells you such a thing is probably lying and stay away from it. In the Madoff case, Madoff never revealed where he “invested” the money. His investors were fools for investing with someone like that. If the same thing applies here, the investors are total fools.
For all you savvy financial gurus out there, you can legitimately earn about 25% a year by investing your money in QQQQ NASDAQ Index Tracking stock and then selling the corresponding call option each month and picking up the premium as income. You can do the same with the SPY S&P 100 index. No further comments.
Chaim S-then do it and you should be a multi-millionaire by now! Chances are you are not. To everyone else-don’t listen to his nonsense. If it was this easy, every Shmoe would be doing it. You will lose your pants. No further comments.
Who says it’s worthless land? It might have become less valuable when the eagles took over, but with casinos coming (for real this time) it should be worth a hundred million by next year. Sounds like he did ok for many years until impatient people started to sue. They probably thought it was impossible that when Eagles land you can’t do anything with your property, but it’s true. They decide he’s a liar, and the lawyers gladly go along with it and make big fees. Sounds like these idiots put their own investment out of of business.
So the state takes the land for eagles and doesn’t pay him anything for it, and now the Feds want to put him in jail. What has this country become?
Only true greedy fools would invest with Barry. If someone were dumb enough to fork over all their money to Barry then they are dumb enough to buy shares in the Brooklyn Bridge. Yea, they’ll file law suits but that money is gone! Hey, should have invested in Love Canal yourself. These greedy dopes probably think they have natural gas under their property and bald eagle nests in their attics. Beyond dumb – greedy pods with an “agenda” to make an easy living. Hey buy some shares of Never Land too!
I agree. People who think they can sign a contract and get 30 percent return each year are naive, simple minded and in la la land. Didn’t know there were such people, but I guess it takes all types. That’s why this dude Barry has a stash overseas. That land is going nowhere but back to the banks, taxes and fines and some bald eagles. Too bad there were so many suckers. They probably think they have dives on that land. Doesn’t hurt to dream, unless you were relying on this money, then your fu$^d.