CONSUMER NEWS    RECALLS    COMPLAINT FORM    SCAM ALERTS  
Small Claims Guide   Class Actions   Lemon Laws   FAQ   Newsletters  


Complain about a product or service

Automotive    Education    Electronics    Family    Finance    Health    Homeowners    Shopping    Travel   
NEWS   Latest |  Archives |  Auto |  Cells, etc. |  Computers |  Financial |  Health |  Homeowners |  Parents |  Privacy |  Scams |  Seniors |  Travel

Maryland Shutters 'Investment Firm' Amid Fraud Charges

Victims lost more than $50 million in Ponzi scheme



November 6, 2007


Read More Scam Alerts ...

The State of Maryland has resolved a major investment fraud investigation by successfully placing a company and its principals into receivership.

Maryland Attorney General Douglas F. Gansler says as many as 1,000 investors lost more than $50 million in what was essentially a Ponzi scheme.

After hearing three days of testimony detailing the business activities of the defendants, Judge Thomas P. Smith, Circuit Court for Prince George’s County, issued an order placing POS DH, LLC, Metropolitan Grapevine, LLC, and Andrew H. Williams, Jr., into receivership and freezing their assets.

The court determined that victims invested their money in promissory notes and investment contract securities, investments that are essentially without value. The court also determined that the defendants’ businesses generated no significant income and that they are insolvent with liabilities of $200,000,000 to $300,000,000 and current assets of approximately $2,000,000.

The court concluded that the defendants were paying previous investors with funds received from new investors, and that the investment program was, in fact, a Ponzi scheme.

“This court order now places the financial control of POS DH, LLC, Metropolitan Grapevine, LLC, and Williams, in the hands of the court-appointed receiver,” said Gansler. “The receiver will now take all of the assets of the Defendants traceable to this investment scam and create a pool of money to be refunded to the investors and other creditors.”

The state filed suit in August 2007, claiming the defendants were violating Maryland’s securities laws by operating an investment program involving the promised payment of homeowners’ mortgages in five years following a payment to POS, while misrepresenting or failing to disclose details about risk, use of proceeds, and company personnel.

The companies used a variety of business names, including POS Dream Homes, Metro Dream Homes, POS Café, Metro Grapevine, and other names as part of the overall scheme.

Gansler says the investigation revealed that POS Dream Home operated an unregistered promissory note investment program under the guise of a mortgage payment plan. Using personal sources and public meetings to solicit potential investors in Metropolitan Grapevine and POS, agents offered the opportunity to live mortgage free.

For an up-front payment to POS of $5,000 plus a percentage of the loan amount, a home buyer or owner was promised full payment of their mortgage in five years or less. The owner then would split the value of the home with POS.

The money to make the payments allegedly was generated from POS’s investment in “POS cafes,” which included an ATM, credit card reader, and other revenue-generating devices.

While soliciting investors, POS and its agents failed to disclose to investors where the cafes were located, past financial results, operating expenses, the lack of any registration of the investments, and the history of management personnel.

Williams is the subject of a 2001 order by the Circuit Court for Prince George’s County, enjoining and restraining him from engaging in the securities business in Maryland. Neither company, its notes, or its promoters is registered with the Securities Division as required by Maryland law.

The attorney general says his Securities Division brought the actions not only to halt the fraudulent scheme and prevent new investor losses, but also to protect whatever assets remain for distribution to the programs’ existing investors.

“There is great risk of loss of investors’ money where there is no demonstrated source of income except other investors,” said Gansler. “In today’s already jittery climate of rapid change in home values and questionable mortgage practices, fraudulent programs like this further erode confidence in the investment and mortgage markets.”



Report Your Experience
If you've had a bad experience -- or a good one -- with a consumer product or service, we'd like to hear about it. All complaints are reviewed by class action attorneys and are considered for publication on our site. Knowledge is power! Help spread the word. File your consumer report now.


Consumer News

November 20 2008

Recent Recalls & Safety Alerts

PRINT, MAIL, ETC.


FREE CONSUMER NEWSLETTERS

The Daily Consumer
Afternoons M-F

Sign up now!


Consumer News & Alerts
Every Sunday

Sign up now!

MOST-VIEWED PAGES

  • Classmates
  • GM-Viagra
  • Sharper Image
  • Sears Auto Centers
  • GE Money Bank
  • Maytag Washers
  • Speed Up Your Metabolism
  • Chinese Formula
  • Aspire
  • Wal-Mart Vision Centers
  • Whirlpool Water Heaters
  • NEW COMPLAINTS

  • Covergirl
  • Paula Young Wigs
  • Family Dollar
  • Bon Ton Stores
  • Firefly
  • Maidenform.com
  • Merry Maids
  • Schnucks
  • Sealy Mattress
  • Cardiotwister
  • Hey there! ConsumerAffairs.com is using Twitter.
    Twitter is a free service that lets you keep in touch throughout the day. Join today to start receiving ConsumerAffairs.com's updates.



    Back to the top |

    Advertisement



    AUTOMOTIVE
    • Dealers
    • Manufacturers
    • Service
    • Extended Warranties
    • Lemon Laws
    • Recalls
    • Tires
    • Transporters

    FAMILY
    • Aging
    • Children, Parenting
    • Recalls
    • Dating
    • Education
    • Entertainment
    • Pets
    • Weddings
    FINANCE
    • Annuities
    • Banks
    • Credit Cards
    • Debt Collection
    • Debt Counseling
    • Insurance
    • Investing
    • Loans
    • Mortgages
    • Payday Loans
    • Student Loans
    • Tax Prep

    HEALTH
    • Drugs, Pharmacies
    • Health Clubs
    • Hearing Care
    • Hospitals
    • Nursing Homes
    • Nutrition, Diets
    • Vision Care
    • Weight Loss
    HOMEOWNERS & RENTERS
    • Appliances
    • Cookware
    • Furniture
    • Home Improvements
    • Lawn & Garden
    • Movers
    • Pools & Spas
    • Realtors, Rental Agents
    • Recalls
    • Utilities

    ELECTRONICS
    • Cable TV/DBS
    • Cameras
    • Cell Phones
    • Computers
    • Home Electronics
    • Internet Access
    • Local Phone Service
    • Long Distance
    • VoIP
    SHOPPING
    • In-Home
    • Online
    • Retail Stores
    • Sporting Goods
    • Supermarkets
    • Telemarketers

    TRAVEL
    • Airlines
    • Bus Lines
    • Car Rental
    • Cruises
    • Hotels
    • Travel Agents
    • Trains

    RESOURCES
    • Class Actions
    • Complaint Form
    • Small Claims Guide
    • Lemon Laws
    CONSUMER NEWS
    • Latest News
    • Automotive
    • Telecom
    • Financial
    • Health
    • Homeowners
    • Scams
    • Seniors
    • Travel
    • More ...

    RECALLS
    • Automotive
    • Children's Products
    • Drugs
    • Food
    • Household Products
    • Sporting Goods

    ABOUT US
    • FAQ
    • Privacy Policy
    • Advertise With Us
    • Newsroom
    • Syndication
    • Terms of Use

    Terms of Use Your use of this site constitutes acceptance of the Terms of Use

    Advertisements on this site are placed and controlled by outside advertising networks. ConsumerAffairs.com does not evaluate or endorse the products and services advertised. See the FAQ for more information.

    Company Response Welcome If complaints about your company appear on our site, we welcome your response. Please see the Response Form for more information.

    For more information, see the FAQ and privacy policy. The information on this Web site is general in nature and is not intended as a substitute for competent legal advice.  ConsumerAffairs.com Inc. makes no representation as to the accuracy of the information herein provided and assumes no liability for any damages or loss arising from the use thereof. 

    Copyright © 2003-2008 ConsumerAffairs.com Inc.  All Rights Reserved.    The contents of this site may not be republished, reprinted, rewritten or recirculated without written permission.