According to federal prosecutors, Salih Acarbulut, a Turkish national who formerly resided in Chattanooga, Tennessee, is on the run. A federal grand jury in Chattanooga indicted Acarbulut on 10 counts of wire fraud and money laundering this week, arising from an alleged Ponzi scheme that robbed more than $12 million from 100 investors. According to WDEF News in Chattanooga:
The indictment alleges that Acarbulut devised a so-called Ponzi scheme from at least as early as 2005 and continuing until about May 2008, which was headquartered in Chattanooga. A Ponzi scheme promises investors exorbitant returns on their money. Initial investors receive large returns which come not from true profits, but from other investor’s funds. Later investors are duped by these false returns, invest, and are ultimately defrauded of their money. In this case, Acarbulut allegedly represented himself to be an experienced and successful foreign currency trader. He guaranteed up to a 48% annual return, paid monthly, on investments. Through this scheme the indictment alleges Acarbulut stole at least $12 million from his investors.
The indictment also charges that Acarbulut promoted the scheme by conducting financial transactions with funds from his crime, that is, money laundering. Criminally derived proceeds were also spent in amounts over $10,000. Each of these transactions constitutes a separate violation of
the money laundering statute.
Notice two things about this case. First, notice that Acarbulut allegedly promised to earn profits through trading in foreign currencies. Forex frauds have reached epidemic proportions. Many investors are not as familiar with the Forex market as they are with stock and bond transactions. That lack of knowledge may lead them to place more faith in someone who claims to have specialized knowledge about that market and an established track record of earning profits there. Smart investors understand that Forex is a market like any other and that the likelihood of a single adviser being able to earn 40 percent returns consistently in that market is the same as someone being able to produce those returns in any other market. It isn’t likely.
Notice also that Acarbulut is a fugitive. Whether or not the allegations against him are true, this tells us something about the mindset of the financial criminal. He will not be deterred by the prospect of criminal charges, much less a civil lawsuit. Investors must discount those supposed deterrents in their calculations. The investment criminal thinks that he or she is going to get away with it. Jail never enters into their thinking, except as it relates to the date on which they will need to flee with their ill-gotten loot.
Always remember that return of investment is as important as return on investment. Get professional help before you commit any part of your nest egg to a broker, adviser, or unregistered investment.