The state of New York is going after a Bronx tax preparer who allegedly ran a $4.6 million Ponzi scheme. New York Attorney General Eric Schneiderman revealed Monday that a Bronx grand jury has indicted Robert H. Van Zandt on 35 counts, including money laundering, fraud, securities fraud, and grand larceny charges. Van Zandt is the winner of CompliancEX’s Ponzi Tax Scheme award.
Van Zandt ran the Van Zandt Agency, a tax preparation company, in the Bronx for several decades. From 2007 to 2011, Van Zandt is alleged to have started investment programs for his tax customers to put their money in. Some customers reportedly invested their life’s savings, including money from retirement plans, settlement agreements, inheritances, or savings plans with Van Zandt. In return, he promised very high rates of returns on their investments, which were supposed to include real estate projects. But in fact, according to PostStarNews.com, these so-called real estate projects his customers were investing in were “impossible to build.”
The defendant took in between $25,000 and $900,000 each from customers, according to the Associated Press. However, prosecutors charge that the money never really went to real estate, or securities, or any of the other things Van Zandt claimed it would. Instead, starting in 2008,the investment plan became a Ponzi scheme, with the money reportedly going to pay previous investors in his plan, to business expenses, and to his own pocket. In all, the state says that his scheme brought in $4.6 million between 2008 and 2011.
The state says that Van Zandt claimed in some cases that the investors’ money was going to buy securities and government bonds, but instead he never made the investments he claimed. In addition, Van Zandt also reportedly used his tax business to find new customers for his scheme. Shocking.
Schneiderman said in a statement: “…when someone abuses the trust built upon longstanding relationships to steal individuals’ life savings, our office will prosecute that person to the fullest extent of the law.” He called Van Zandt’s actions “despicable” and “unconscionable,” saying that the defendant “stole his victims’ life savings, and forced some of them to re-enter the workplace or rely on government assistance to survive, while others face foreclosure on their homes or bankruptcy.” Whatta guy.
Van Zandt is out on $500,000 bail. He could face up to 25 years in the pokey if he is convicted on all counts.
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Lisa Swan is a Feature Writer for the Compliance Exchange and the Wall Street Job Report. She is also a columnist for The Faster Times and a blogger for Subway Squawkers. Her work has also appeared in the New York Daily News, Yahoo Sports, Huffington Post and the books Graphical Player 2011 and Graphical Player 2010.