Loan Sharks, How Cliché
This Week In Blunders – March 23-29
Some guy named Joey and his brother Jimmy ran a loan-sharking racket in Philly – and if you didn’t pay them? Well, you’d pay, if you know what I mean.
“You’ll go to the bottom of the Hudson, so figure it out,” Joey reportedly says to a woman who fell behind on her payments. “‘I want to be paid.’”
Besides literally threatening the ol’ “cement shoes” treatment, Joey added the possibility of kidnapping her kids or planting a bomb in her car.
And the heck of it is, Joey wasn’t even the enforcer for the organization.
That job fell to his brother Jimmy. He did things like club a lawyer with a flashlight because he was assigned to a case involving the seizure and sale of Joey’s assets. The lawyer required six staples in his head following the attack he endured on the streets of Philly.
Jimmy also threatened to harm one of his company’s employees who pleaded guilty and agreed to rat on the organization.
What kind of cheesy mob epic is this?
[[[Don’t Miss: The Business Blunders Hall of Shame.]]]
Joseph LaForte, 54, received a 15-year prison sentence on Thursday for all this menacing and so much more. In addition to petty street crimes, Joseph LaForte defrauded investors out of $288 million and cheated the IRS among other offenses.
His brother, James LaForte, 47, (who, by the way, has denied his reputed links to the Gambino crime family), got 11.5 years on March 13.
These two thugs were running Par Funding, a company making high-interest-rate loans to small business owners who were less than creditworthy.
The subprime lender imploded in April 2020 when it could no longer make payments to its investors. Imagine that – a loan -hark racket that can’t even pay its own bills.
Where’d the money go? To the usual trappings of Ponzi artists everywhere. According to the Justice Department:
“From 2015 until the unraveling of the fraud in mid-2020, Joseph LaForte caused Par Funding to pay him and his wife more than $120,000,000 in fraudulent proceeds, with which he purchased homes, vacation properties, vehicles, artwork, jewelry, dozens of investment properties, a boat, and a private jet. LaForte rewarded the loyalty of co-conspirators, including James LaForte and Cole Barleta, by making each of them multi-millionaires.”
This is now billed as one of the biggest financial crimes in Philadelphia history.
It happened right in the open. For instance, as Philadelphia magazine reports, in November 2019 as many as 300 guests gathered in the ballroom at the Sheraton Hotel in King of Prussia, Pa., for a free steak dinner and the promise of 14% returns.
“Every day we go into the office, we understand there are real lives behind these investments,” Joseph LaForte told the group. “We really feel strongly about the fact that people are trusting us.”
Yet Joseph LaForte was already a two-time felon for running a Ponzi scheme and an offshore gaming racket when he founded Par Funding in 2012 under his wife’s name.
“Joe LaForte is a career grifter,” said U.S. Attorney David Metcalf. “He has spent his adult life lying, cheating, and stealing his way to a lavish lifestyle paid for with other people’s money.”
And justice hadn’t caught up with him until now.
How could a known financial felon pull off something this huge and this cliché for this log? Two mugs named Joey and Jimmy set up a loan sharking racket in Philly. Wasn’t anybody paying attention?
Ozy Media fraudster draws ‘Get out of jail free” card
Ozy Media founder Carlos Watson was due to begin serving his 116-month prison sentence when he won a last-minute commutation from President Donald Trump on Friday.
Watson, who once hosted a show on CNBC, was convicted in July for a series of brazen frauds. Court evidence showed he lied to investors about everything, including revenue, cash-on-hand, profits, celebrity ties, acquisition prospects and contract negotiations.
The company imploded in October 2021 after The New York Times reported that its chief operating officer, Samir Rao, impersonated a YouTube executive on a conference call with Goldman Sachs. It was a desperate bid to land a $45 million investment.
Watson blamed the episode on Rao having a mental health crisis. But court testimony showed Watson was in on the call, too.
Watson wasn’t the only white-collar criminal receiving a Trump reprieve this week …
Did we somehow have Nikola’s CEO all wrong?
Investors lost millions of dollars buying stock of Nikola, and in December 2023, its CEO Trevor Milton was sentenced to four years in prison for defrauding them.
Milton, 42, was convicted in October 2022 for spinning lies about Nikola’s electric- and hydrogen trucks.
On Thursday, he announced he’d received a pardon from President Donald Trump.
“This pardon is not just about me—it's about every American who has been railroaded by the government, and unfortunately, that's a lot of people.
“It is no wonder why trust and confidence in the Justice Department has eroded to nothing. I wish judges would stop believing whatever the prosecutors feed them so Americans could trust the justice system again. Until that happens, our justice system will continue to erode until there is nothing left.”
His lawyer was Brad Bondi, the brother of U.S. Attorney General Pam Bondi, MarketWatch reported. He also sent millions of dollars to Republican candidates and the Trump 47 Committee as he fought his appeal.
Here’s what Trump had to say about it:
“They say the thing that he did wrong was, he was one of the first people that supported a gentleman named Donald Trump for president. He supported Trump. He liked Trump. I didn’t know him, but he liked him.
“They persecuted, they destroyed five years of his life. He ... fought for five years of his life, and he did nothing wrong.
“And he’s a good person.”
Also this week, we learned Trump pardoned three co-founders of the BitMEX global crypto exchange. They had pleaded guilty to violating the Bank Secrecy Act – you know, the law that aims to curb money laundering. And speaking of money laundering …
Not your tired. Not your poor. Just your ill-gotten gains
The United States is the third-best place in the world to launder money. Not Russia, not Panama, not even the Cayman Islands, but the good ol’ US of A.
That’s according to a new report from Transparency International, the global coalition against corruption, based in Berlin, Germany.
The main reason it’s so easy to launder money in the U.S. is weak transparency in real estate deals, the group reports.
Property, after all, can be held anonymously through shell companies. And there are few if any anti-money laundering regulations that real estate professionals have to follow.
According to the group:
“In most of the world’s leading economies and major financial centres, criminals, the corrupt and their enablers can exploit a series of loopholes to stash dirty money in real estate while likely avoiding detection. Property markets are vulnerable to abuse because real estate can be held anonymously and avoid meaningful third-party control in many places.
Australia and South Korea beat out the U.S. for the first- and second- worst in money laundering vulnerabilities.”
‘Drill baby drill’ will kill oil production
Oil executives are not jumping for joy over President Trump’s energy policies, according to an anonymous survey by the Federal Reserve.
“The administration's chaos is a disaster for the commodity markets,” said one survey respondent. “‘Drill, baby, drill’ is nothing short of a myth and populist rallying cry. Tariff policy is impossible for us to predict and doesn't have a clear goal. We want more stability.”
The executives fear Trump’s policies will drive down the price of oil to $50 a barrel, a level where it’s increasingly unfeasible to drill new wells.
“The rhetoric from the current administration is not helpful. If the oil price continues to drop, we will shut in production and do quick drilling,” said one executive.
Oil executives made significant donations to Trump last year after he requested $1 billion from them in what some Democrats have described as a blatant quid pro quo.
On the campaign trail, Trump said he wanted to boost U.S. oil production, even though the U.S. was already pumping record amounts of oil.
Everyone in the oil business should know that the more they produce, the more they drive down the price of their product.
What did they think was going to happen?
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It's sad. The scams are never ending.
The plain fact is that Trump didn't NEED to expand oil production. Despite all the Green rhetoric the Biden admin was letting oil production expand as fast as it practically could. It's now at the highest level in history. Most Green policy is terrible for America and wonderful for China, but oil was a big exception to the rule.