Do we even have to go through the exercise of putting this through Equity Private’s Guidebook for Financial Fraud Analysis (1st Edition)?
New York and federal officials are investigating a Hauppauge investment firm that has indefinitely halted payouts to clients, citing setbacks on commercial real estate loans.
The firm, Agape World, specializes in short-term, high-yield loans to developers and builders, offering investors returns of as much as 14 percent in as little as 72 days.
The firm’s founder, Nicholas Cosmo, told investors on a 1 p.m. conference call on Friday that three borrowers had defaulted on loans, forcing the halt in payments. Cosmo told more than 150 investors on the call that he had hired a law firm to foreclose on the projects and recoup investments, but that the process could take as long as one year.
“My job is to make sure that principal is paid back in total,” Cosmo said on the call.
Cosmo did not immediately respond to e-mails seeking comment. Attempts to reach him by phone were also unsuccessful.
Agape clients invested between $5,000 and $3 million each to fund what are known as bridge loans that usually lasted 10 to 12 weeks, but which could extend for several months.
Need I go on? Really? Alright.
In 1999, Cosmo was sentenced to 21 months in federal prison and ordered to pay $177,000 in restitution for his role in defrauding investors of a Long Island securities dealer. The court also ordered him to undergo gambling therapy as part of his sentence.
Cosmo founded Agape World soon after his release from prison in August 2000 with money from family and friends.
This is my favorite part though:
Entrepreneur Magazine last year named Agape one of America’s fastest-growing companies.
Then there’s this:
Angry victims of an alleged Ponzi scheme stormed the Hauppauge offices of Agape World, and one of them socked owner Nick Cosmo upside his head Friday.
I mean, you can’t make this stuff up.
Update:
Posted by Anal_yst, Jan 26, 2009 4:20PM
This.Is.Awesome!
Want pics of the carnage asap!
Your wish is my command. Pics after the jump.
LI investment firm halts payouts, under investigation [Long Island Business News]
Agape investor packed a punch [LI Biz Blog]
This.Is.Awesome!
Want pics of the carnage asap!
Did anyone see that crazed investor yelling his bastardized English in the Agape lobby on cnbc? Looks like the UAW was light one employee today. Silly northerners.
Wait, wait, wait. These people knew they were making swing loans to builders in a housing rout. And in the good days they were getting paid maybe 14% in less than 90 days. And they didn’t think there was any risk here?
What?
I can see being fooled by Bernie, who had swank offices in the Lipshitz building, held reputable positions and the industry, and ostensibly was front-running other customers to make money for the managed accounts.
But who gives good money to a guy named “Cosmo” working out of an office in Hauppauge?
All that said, it’s likely that this was a real lending scheme and not a Ponzi and the investors will get _something_ back – whatever Cosmo can squeeze out of some half-completed buildings in a commercial real estate recession…
Wasn’t the town of Hauppauge founded a member of the Ponzi family?
once again, I point to the fact that the guy didn’t even have a satellite office in manhattan. what kind of legitimate “hedge fund” (okay, so he didn’t use the term hedge fund) doesn’t have a presence in a major metropolitan city? happauge? seriously? c’mon, he might as well be in indiana…flying a plane…with a motorcycle in storage. it just goes to show that people are always looking for easy dollars. fools and their money…
funny, that pic looks like a still from boiler room.
I laughed out loud. Guffawed, even. Having seen this dance play out a few times already with better looking loans, they’d better hope that Cosmo knew something about security interest perfection…
#7, I was JUST about to say the same thing.
Jim Young: You Want details? Fine. I drive a Ferrari, 355 Cabriolet, What’s up? I have a ridiculous house in the South Fork. I have every toy you could possibly imagine. And best of all kids, I am liquid.
Where’s the paddywagon, damnit?!
EP…sorry for all the banter during 08…your posts are getting exponentially better and more interesting to read in 09
too JT Marlin, didn’t read
I’m tellin’ you Jerry, we can make loads of dough. Loads of IT!!
I’m tellin’ you Jerry, we can make loads of dough. Loads of IT!!
Love the disclaimer on their web site
“all content is inserted by Agape World Inc.”
Is that why the offer loan applications?
http://www.agapeworldinc.net/
http://libn.com/libizblog/2009/01/26/round-2-cosmo-to-press-charges/
what a dick.
I think there was a christian group at either my high school or college called “Agape.” Might have a biblical meaning?
Does anyone else think this building (and its LI location) resemble Boiler Room?
http://www.flickr.com/photos/libn/3229802776/in/photostream/
@19 agape is a Greek word for brotherly, non-sexual love. Plato talked about agape it in “Symposium” about 2,000 years before Christ.
At last, we’re at the point that every crappy investor/money manager/random hack is running an “alleged ponzi/pyramid scheme”…
If we don’t get on this crap fast the prole’s might just make it to the next step, and we all know what happens then…
From the Bloomberg:
In [an] interview, Cosmo handed a Bloomberg reporter a
reprint of a page from Entrepreneur Magazine’s May 2008 issue,
which listed Agape World as number 73 in its HOT 100 fastest
growing businesses. Cosmo told the magazine he began the business
with one employee in August 1999. Actually, he was imprisoned at
Allenwood that summer.
@21 thanks for the link. Love the letter posted on the door: http://www.flickr.com/photos/libn/3228953895/sizes/l/in/photostream/
“We are no longer accepting investors into Agape World, Inc. This will further disprove the theory that this is a ponzi.”
Certainly this would be proof enough, but in the aforementioned October Bloomberg interview Cosmo “claimed he hadn’t accepted any new investors for three years.”
holy shit that letter reads like it was written by an 8 year old.
is it against the law for guido’s to use contractions?
Weird, my maid asked me about investing with these clowns a couple of years ago. Took about 90 seconds of the google to render a strong no.
Due dilligence what?
The guy had a fraud felony conviction in his own name.
You guys are getting slow. Nobody noticed that the picture on the Agape website is the friggin Brooklyn Bridge? You wanna buy it?
i would think there’s a picture of the brooklyn bridge because they did bridge loans for construction projects.
get it?
maybe i’m not as smart as you.
so assuming this guy was somewhat legit, it’s going to be entertaining watching his company slap liens on unfinished construction projects.
he probably has another company already set up to buy this crap for like 20 cents on the dollar.
For the diehard Agape fan, 19 pages:
http://www.scamvictimsunited.com/phpBB2/viewtopic.php?f=39&t=3243&st=0&sk=t&sd=a
#32, I always imagined an “unsophisticated investor” as a Princeton liberal arts major or something. Thanks for pulling the wool from my eyes.
this is priceless, posted on the LIBN blog this past Saturday:
“Bob Says:
January 24th, 2009 at 2:43 pm
Nick Cosmo is a great guy who has contributed much to society and to his town and community for many years. Just because times are bad and the economy is the way that it is, now everyone is trying to withdraw all their investments and is only making things worse. The stupidity of some people never ceases to amaze me. Cosmo, in my view, is a high respectable and hard working man. I stand behind him and will not believe anything that Mr. Winzelberg has written until cold hard details and figures surface (which they won’t). I have had nothing but good encounters with Mr. Cosmo and respect all that he has done in years past. I have the utmost respect for the man, and stand behind him. I know that these allegations are untrue, and that the truth will come out.”
and….. today:
“Agape World chief Nicholas Cosmo turned himself in to authorities on Monday night after the FBI and U.S. Postal Inspection Service raided the Hauppauge-based investment firm’s headquarters earlier in the day.
“The arrest warrant is expected to be unsealed Tuesday and sources said he would be charged with defrauding investors out of $380 million.”
i am about to cry with joy
jesus
now where am i to get a loan for my construction company and plate of pasta barilla?
the same place bernie madoff’s clients get money for gefilte fish.
Some of the “ballers” who worked at Agape:
http://www.myspaceprofiles.org/profiles/61454804.html
The Bentley is cool but my personal fave is the fishtank:
http://pics.myspaceprofiles.org/804/l/61454804_11.jpg
“To all fellow investors…..Nick has left a voicemail explaining the circumstances on his extension. 631-231-5600 x301. Letters are going out to all clients which you will receive by weeks end. Nick states he can not answer all calls nor can he return all calls.”
-posted Sunday night
Slingin’ Bridges is what people do after they lose their licences, Private Placements or Bridge loans. These firms usually last less than 2 years. The rip to the “Broker” is usually something huge.
After it folds, they go off and do some other nefarious business. You would think the public would be aware but the average investor is just so incredibly stupid it boggles the brain.
@14 winner.
The good stuff just keeps coming and coming. It all makes the Wolf of Wall Street, Jordan, look downright honest. At least his firm actually bought and sold you some penny stocks.
I know you’re not standing on your front porch with a bag of money waiting for me to call you. But I’m not some 18-year-old selling a cure for AIDS. I’m 46 years old, I have 22 years market experience, I know this business. So pick up your skirt, grab your balls, and lets go make some money
Agape was first debunked by http://www.fatwallet.com/forums/arcmessageview.php?catid=52&threadid=780511 back in November 2007.
The most recent discussion is here: http://www.fatwallet.com/forums/finance/865655/
FW highlighted the fact that it was infeasible to pay out 15% every 3 months when they only collect 10-12% interest from the borrowers.