Police: Man charged for 'Ponzi' scheme worth $3M

March 10, 2011 12:44:33 PM PST
Lower Merion police have announced the arrest of a man for defrauding eight people in what authorities say is a classic Ponzi scheme.

Ira Pressman of Bala Cynwyd was arrested for corrupt organizations, theft by deception, theft by failure to make required disposition of funds and related offenses, including violations of the Pennsylvania Securities Act.

Officials say, from 2007 through 2010, Pressman solicited numerous people to invest large amounts of money with him, even though he was not licensed by the Pennsylvania Department of State to solicit investments. Pressman promised each person that their money would be used to purchase various "closeout" items, which he would then re-sell to vendors at a substantial profit.

However, instead of using the money to effectuate the deals he promised, authorities say, Pressman would keep the money for his own personal use. He even created forged invoices and purchase orders to show his victims in order to demonstrate that the investment opportunities were legitimate.

Pressman spent some of the money for personal expenses, and used some of the victims' money to pay back, in part, the original investors/victims ? a classic "Ponzi" scheme. In total, Pressman defrauded eight victims and stole $3,318,491.50.

Pressman was arraigned Thursday morning, at which time he waived his preliminary hearing. He was unable to post bai of $1,000,000 and has been remanded to the Montgomery County Correctional Facility.