Cosmo Indicted for Mail, Wire Fraud in Ponzi Scheme

Cosmo Indicted for Mail, Wire Fraud in Ponzi Scheme - 4/23/2009

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HEADLINES \| SETTLEMENTS AND DISMISSALS \| COURT FILINGS LINKS TO OTHER NEWS \| NEWS ARCHIVE	HEADLINES ARCHIVED SETTLEMENTS AND DISMISSALS ARCHIVED

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Cosmo Indicted for Mail, Wire Fraud in Ponzi Scheme
Patricia Hurtado

Bloomberg. April 23, 2009
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EXCERPT: Nicholas Cosmo, accused by prosecutors last week of operating a Ponzi scheme that swindled at least 6,000 people out of $413 million, was indicted today on charges of wire and mail fraud. Cosmo, owner of Agape World Inc. and Agape Merchant Advance LLC on New York’s Long Island, has been in custody since Jan. 26, when prosecutors charged him with operating a fraud scheme that they initially believed cheated at least 3,000 investors out of $370 million. Prosecutors in the office of U.S. Attorney Benton Campbell in Brooklyn, New York, today unsealed a 32-count indictment against Cosmo that includes 10 counts of wire fraud and 22 counts of mail fraud. Cosmo claimed Agape solicited investor funds that were used to make short-term bridge loans. Agape received about $413 million from investors, while only about $30 million in loans were made, prosecutors said. “Although he told investors that their money was needed to fund specific bridge loans, Cosmo and account representatives working at his direction solicited investments well in excess of what was needed to fund the specific loans,” the U.S. said in the indictment. “Cosmo also claimed that Agape was making certain loans to particular borrowers when, in fact, as defendant then well knew and believed, Agape was not,” the U.S. said in the indictment. Prison, Fines Robert Nardoza, a spokesman for Campbell, said that each count of mail or wire fraud carries a prison term of as long as 20 years in prison and fines of at least $250,000. Cosmo remains in custody until at least an April 29 hearing. In the indictment, the U.S. said Cosmo operated his scheme, from October 2003 to this January, a longer period than prosecutors previously alleged. Cosmo is accused of pocketing the money that investors believed would be used for bridge loans.

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