We have a true entrepreneur of fraud on our hands here.

We here at Dealbreaker really can’t get enough of Ponzi schemes. It’s hard to say what makes them so appealing. Perhaps it’s that they come in every shape and size, from Bernie Madoff (or Social Security or the credit crisis, depending on the elasticity of your definition) to the relatively small. Perhaps it’s what people do with the money they steal. Perhaps it’s the little things you don’t even think about. Perhaps it’s the bewildering variety of ways people sell one of the oldest scams in the books.

Still, it can get, if not a bit tedious, a bit confusing and depressing, all of these startling similar frauds. Hard to tell apart. It’s why we get so very excited by the rare true innovation in the Ponzi arts. And Perry Santillo definitely came up with.

No, it’s not how he spent his money. “Cars, casino junkets and houses in multiple states” are pretty par for the course, and commissioning a song dubbing you “King Perry” doesn’t raise this to the truly sublime. It’s definitely not going after the elderly; that’s also quite standard and not worthy of any kind of congratulation. No, it’s how Santillo recruited his victims. While all Ponzi schemes use money from new investors to pay off exiting ones, how many use money from existing investors to literally just buy new ones?

To ensure a fresh supply of victims, Santillo and his confederates bought the businesses — and client lists — of a series of investment advisers and brokerages, prosecutors said. Over the years, they acquired investment firms in Tennessee, Ohio, Minnesota, Nevada, California, Florida, South Carolina, Texas, Pennsylvania, Maryland and Indiana, according to court documents.

King Perry, indeed.

Santillo appeared Monday in federal court in Scranton, Pennsylvania, to plead guilty to a federal fraud charge, having already entered a guilty plea last month to similar charges in Rochester, New York. Each charge carries a maximum 20-year prison sentence.

Ponzi schemer ‘King Perry’ pleads guilty; had lived lavishly [AP]

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