Robert H. Shapiro, the former CEO of the Woodbridge Group of Companies, pleaded guilty to running a $1.3 billion Ponzi scheme that defrauded over 7,000 investors.
The Woodbridge Group of Companies has appeared frequently in this blog space related to the ongoing investigations and penalties involving its vast Ponzi scheme operation. Earlier this year, a federal court judge in Florida ordered the Woodbridge Group and Shapiro, to pay a combined penalty of over $1 billion dollars as a result of the scheme.
Woodbridge Group must pay $892 million and Shapiro must pay a $100 million civil penalty and disgorge more than $20 million in ill-gotten gains and interest. The Securities and Exchange Commission had brought charges against the company in December 2017, alleging that the company had spearheaded massive Ponzi scheme which defrauded over 8,400 investors nationwide, many of whom were seniors.
Shapiro pleaded guilty to conspiracy and tax evasion and could serve up to 25 years in prison. Shapiro had promised investors returns as high as 10% from investments in loans to property developers. In typical Ponzi scheme fashion, the money instead went to repay earlier investors, and fund a lavish lifestyle for Shapiro; funding his $6.7 million home and $3.1 million for chartering planes and personal travel.