Development Firms Settle Ponzi Charges

Five Southern California real estate development companies agreed to pay $106.6 million plus interest to settle allegations they engaged in a Ponzi scheme that preyed on hundreds of elderly people, the Securities and Exchange Commission said.

The people who ran the operation themselves were cheated when they invested some of the money in a fraudulent “prime bank” scheme promising a 100% return, the SEC said.

Earlier this year, Ernest F. Cossey and Gary W. Williams, two men who controlled TLC Investments & Trade Co. and its related companies, agreed to pay a total of $11.3 million to settle related SEC charges.

SEC attorney Thomas Zaccaro couldn’t immediately provide the names or phone numbers of lawyers acting for the companies.