Nicholas Cosmo
Encyclopedia
Nicholas Cosmo was arrested January 26, 2009 on charges of an estimated $370–413 million Ponzi scheme
. Cosmo is alleged to have conducted the scheme using his company Agape World Inc. in Hauppauge, New York
, which claimed to make its profits via commercial bridge lending
. Authorities arrested him in Hicksville, New York
.
Cosmo was arraigned in Islip, New York on January 27, 2009 on charges of mail fraud. Cosmo had previously been convicted of felony fraud in 1999, and had served his sentence of 21 months in prison for the offense.
On October 14, 2011, Cosmo was sentenced to 25 years in prison.
Prosecuters were only able to trace $10 million dollars of bridge loans that were made. $80 Million to $100 Million was allegedly lost in Commodities Future Trading and $55 to $63 Million of the investors funds went to pay the broker's commissions.
The complaint against Agape World stated that many of the employees had criminal records. Postal inspectors said Cosmo paid the brokers, some of whom were ex-convicts with records that included robbery and heroin importation, to recruit investors.
One of the largest assets of Agape World was an indoor athletic complex purchased for $3.85 million dollars. The complex was sold via auction in June 2009 to a company called Coastal Sports. Cosmo had purchased the 38000 square feet (3,530.3 m²) building in Hauppauge, New York
for $3.85 million last year and spent another $1 million to transform the former paintball arena into indoor athletic fields.
The building was the most valuable asset in Cosmo’s holdings liquidated by bankruptcy trustee, Silverman Acampora, and was auctioned off by David R. Maltz & Co. of Plainview, New York.
Cosmo, chief executive of a private suburban New York investment firm indicted for a $400 million fraud, was freed from jail on Thursday after it took months for him to make bail.
A U.S. judge released Cosmo on $1.25 million bail secured by property and frozen bank accounts but ruled he would be confined to his home under electronic monitoring on New York's Long Island.
U.S. District Judge Denis R. Hurley, at a hearing in Central Islip, New York, ordered that Cosmo be jailed pending trial after prosecutors alleged he used a computer and tried to transfer assets in violation of his bail conditions and provided false statements to a U.S. Pretrial Services officer.
Ponzi scheme
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from any actual profit earned by the individual or organization running the operation...
. Cosmo is alleged to have conducted the scheme using his company Agape World Inc. in Hauppauge, New York
Hauppauge, New York
Hauppauge is a hamlet and CDP in the Town of Islip and the Town of Smithtown in Suffolk County, New York, United States. The population of the CDP was 20,100 at the time of the 2000 census....
, which claimed to make its profits via commercial bridge lending
Bridge loan
A bridge loan is a type of short-term loan, typically taken out for a period of 2 weeks to 3 years pending the arrangement of larger or longer-term financing.-Description:A bridge loan is interim financing for an individual or business until...
. Authorities arrested him in Hicksville, New York
Hicksville, New York
Hicksville is a hamlet and census-designated place located within the Town of Oyster Bay in Nassau County, New York, United States. The population of the CDP was 41,547 at the 2010 census...
.
Cosmo was arraigned in Islip, New York on January 27, 2009 on charges of mail fraud. Cosmo had previously been convicted of felony fraud in 1999, and had served his sentence of 21 months in prison for the offense.
On October 14, 2011, Cosmo was sentenced to 25 years in prison.
Agape World
Prosecutors stated that Nick Cosmo used $212,000 in Agape funds to pay restitution from the 1999 federal mail fraud conviction.Prosecuters were only able to trace $10 million dollars of bridge loans that were made. $80 Million to $100 Million was allegedly lost in Commodities Future Trading and $55 to $63 Million of the investors funds went to pay the broker's commissions.
The complaint against Agape World stated that many of the employees had criminal records. Postal inspectors said Cosmo paid the brokers, some of whom were ex-convicts with records that included robbery and heroin importation, to recruit investors.
One of the largest assets of Agape World was an indoor athletic complex purchased for $3.85 million dollars. The complex was sold via auction in June 2009 to a company called Coastal Sports. Cosmo had purchased the 38000 square feet (3,530.3 m²) building in Hauppauge, New York
Hauppauge, New York
Hauppauge is a hamlet and CDP in the Town of Islip and the Town of Smithtown in Suffolk County, New York, United States. The population of the CDP was 20,100 at the time of the 2000 census....
for $3.85 million last year and spent another $1 million to transform the former paintball arena into indoor athletic fields.
The building was the most valuable asset in Cosmo’s holdings liquidated by bankruptcy trustee, Silverman Acampora, and was auctioned off by David R. Maltz & Co. of Plainview, New York.
Cosmo Post Bail
As of June 2009, Cosmo was unable to post bail. Judge Hurley would not release Cosmo until several conditions were met; Cosmo's relatives agreed to back a $1.25 million bail package secured by their homes and financial accounts.Cosmo, chief executive of a private suburban New York investment firm indicted for a $400 million fraud, was freed from jail on Thursday after it took months for him to make bail.
A U.S. judge released Cosmo on $1.25 million bail secured by property and frozen bank accounts but ruled he would be confined to his home under electronic monitoring on New York's Long Island.
Judge Revokes Cosmo’s Bail
In October 2009, a federal judge found that Cosmo couldn't be trusted and ended his house arrest after less than three months and returned him to jail to await trial.U.S. District Judge Denis R. Hurley, at a hearing in Central Islip, New York, ordered that Cosmo be jailed pending trial after prosecutors alleged he used a computer and tried to transfer assets in violation of his bail conditions and provided false statements to a U.S. Pretrial Services officer.
Cosmo Pleads Guilty to $413 million Ponzi Scheme
Cosmo pleaded guilty to mail and wire fraud charges on Friday October 29, 2010, and faced up to 40 years in prison. On October 14, 2011, he was sentenced to 25 years in jail. "Those who lie and steal from the investing public are on notice that they face severe penalties", U.S. Attorney Loretta Lynch in Brooklyn said today in a statement. "As recounted today in court by several of his victims, the defendant's actions crushed the hopes and dreams of everyday citizens".External links
- Website of Agape World's receiver
- Summary of Articles and Videos at New York Newsday (January 27, 2009)
- "Another Ponzi Scheme? Feds Arrest Money Manager Cosmo", Time (January 27, 2009)
- "Troubled Times Bring Mini-Madoffs to Light", The New York Times (January 28, 2009)
- "Cosmos Field of Dreams Sold For 3.4M", Long Island Business News (June 4, 2009)
- Ponzi Schemer Cosmo Denied Bail for Now" Newsday (June 23, 2009)
- "Judge Revokes Cosmos Bail", Wall Street Journal (October 9, 2009)
- "Cosmo Pleads Guilty" Business Week (November 1, 2010)