PLATINUM PARTNERS AND ITS FAMILY PRINCIPALS GETTING WEALTHY BY DIVERTING ASSETS- THE IMPORTANCE OF UNDERSTANDING FRAUD AND THE FINANCES INVOLVED…
Lost Messiah, July 21, 2016
Platinum Partners is in the process of liquidating one of its funds. We maintain that the company is insolvent and is in the process of bilking investors out of millions, an opinion based upon months of research. We maintain that hundreds of people have lost money – lifetime investments – in schemes like Black Elk and others. We maintain that the NYC scandal runs far deeper than event the most seasoned investigators imagine. We believe that the key to it all rests in understanding Fraud from its basest atomic elements – like the periodic table. Below you will find the New York Post Atricle referencing the liquidation. We begin, however, as follows:
Dear Bart M. Schwarts:
You will need to do your research before you begin “overseeing a total investigtion” and verifying assets. They are not where you think they are. The numbers will likely look clean on the face. The men involved in Platinum Partners are not stupid now, nor were they in the past. Rather, they are savvy business men, players in a market where everything goes, able to justify their wealth because it was manna from heaven – mainly within the Chabad community. These men are not simply charitable philanthropists but rabidly aggressive opportunists. The money is going to be where you least expect to find it.
Be mindful of the FRAUD TRIANGLE:
There remains a story to be told about Platinum Partners, Black Elk, Oil Wells, Diamond Mines, “Event Driven Investments,” and more. It is long and detailed and has been promised to you. It will be forthcoming.
In the meantime, we can illustrate simply by following the money, the assets and the investments: Platinum Partners has assets which have been undoubtedly distributed to the principals: Murray Huberfeld, Mark Nordlicht, David Bodner, the trusts of both the Bodner family and the Huberfeld family, the wives of each of these men who are sisters, and many other parties.
There were a lot of victims of Platinum Partners.
THE NEW YORK POST REPORTS:
The hedge fund caught up in a New York City municipal union kickback scandal is now liquidating two of its funds, The Post has learned.
Up to now it was believed that Platinum Partners, which allegedly paid the union president $60,000 in return for getting a $20 million investment, was liquidating just one of its funds.
But the contagion of being linked to the scandal-scarred New York City’s Corrections Officers Benevolent Association, or COBA, seems to have forced the embattled Platinum to liquidate a second fund, according to a letter it sent to investors on Wednesday.
The letter said the fund had hired a former federal criminal prosecutor to liquidate the funds.
Bart M. Schwartz, who was the head of the Manhattan US Attorney’s criminal prosecution division when Rudolph Giuliani headed the office, has been hired to “achieve an orderly liquidation and protect investors’ interests in the Funds,” according to the letter.
Platinum is charged with paying the kickback in 2014 to then-COBA boss Norman Seabrook.
That the letter describes the liquidation of more than one fund could mean that there’s deeper trouble with the ailing hedge fund than previously thought.
To read the entire article click here.
UNDERSTANDING THE FRAUD TRIANGLE:
The Fraud Triangle and What You Can Do About It
One of the older and more basic concepts in fraud deterrence and detection is the “fraud triangle.” While researching his doctoral thesis in the 1950s, famed criminologist Donald R. Cressey came up with this hypothesis to explain why people commit fraud.
The three key elements in the fraud triangle are opportunity, motivation, and rationalization. Opportunity is the element over which business owners have the most control. Limiting opportunities for fraud is one way a company can reduce it.
The opportunity to commit fraud is possible when employees have access to assets and information that allows them to both commit and conceal fraud. Employees are given access to records and valuables in the ordinary course of their jobs. Unfortunately, that access allows people to commit fraud. Over the years, managers have become responsible for a wider range of employees and functions. This has led to more access for them, as well as more control over functional areas of companies. Access must be limited to only those systems, information, and assets that are truly necessary for an employee to complete his or her job.
Motivation, another aspect of the fraud triangle, is a pressure or a “need” felt by the person who commits fraud. It might be a real financial or other type of need, such as high medical bills or debts. Or it could be a perceived financial need, such as a person who has a desire for material goods but not the means to get them.
Motivators can also be nonfinancial. There may be high pressure for good results at work or a need to cover up someone’s poor performance. Addictions such as gambling and drugs may also motivate someone to commit fraud.
Lastly, employees may rationalize this behavior by determining that committing fraud is OK for a variety of reasons. For those who are generally dishonest, it’s probably easier to rationalize a fraud. For those with higher moral standards, it’s probably not so easy. They have to convince themselves that fraud is OK with “excuses” for their behavior.
Common rationalizations include making up for being underpaid or replacing a bonus that was deserved but not received. A thief may convince himself that he is just “borrowing” money from the company and will pay it back one day. Some embezzlers tell themselves that the company doesn’t need the money or won’t miss the assets. Others believe that the company “deserves” to have money stolen because of bad acts against employees.
Business owners and executives must take control of fraud by working on the portion of the fraud triangle over which they have the most control: the opportunity to commit fraud. It may be difficult for management to do anything about an employee’s needs or rationalizations, but by limiting opportunities for fraud, the company can reduce it to some extent.