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Entries in charity (1)

Monday
Sep102012

Man Who Operated Charity As Ponzi Scheme Sentenced to Eight Years in Prison

A federal judge handed down an eight-year prison term to a man who duped investors out of millions of dollars in a Ponzi scheme that masqueraded as a charitable organization.  Joseph Angelo Sivigliano, 80, received the sentence from United States District Judge David Russell after a federal jury convicted Sivigliano earlier this year of forty-six criminal charges that included conspiracy, wire fraud, and money laundering.  While investors were told that investment proceeds would be used to benefit philanthropic ventures, in reality, Sivigliano operated an elaborate Ponzi scheme that ultimately took in nearly $4 million from investors.  Sivigliano was also ordered to pay more than $2.21 million to victims as restitution.

According to authorities, Sivigliano operated Helping Hearts and Hands ("HHH"), based in Bethany, Oklahoma.  Potential investors were assured that HHH was a 501(c)(3) charitable organization, and that profits earned from investments in real estate ventures would be used for humanitarian ventures such as the support of a Christian childcare facility known as "Teaching Little Hearts and Hands."  Aided by co-conspirators Dwight Pimson and Venus Marie Pimson, nearly 70 investors eventually entrusted $3.8 million to the operation.

However, rather than use investor funds to operate his "charity", prosecutors accused Sivigliano of operating a classic Ponzi scheme in which new money was used to pay returns to existing investors.  Additionally, investor funds were siphoned off for a variety of unauthorized purposes, including propping up several Sivigliano-owned businesses including Celebrity Limo and Valet and MC Productions, Inc.  Unbeknownst to investors, Sivigliano also failed to register himself and HHH  with Oklahoma securities regulators.  Victims were estimated to sustain total losses of approximately $1.7 million in the scheme.

Both Dwight and Venue Pimson agreed to plead guilty and cooperated with prosecutors in the case against Sivigliano.  Dwight Pimson later received a five-year prison term, while Venus Pimson was sentenced to a thirty-month term.  Each was also ordered to pay more than $2 million in restitution to victims.