Articles Posted in White Collar Crime

This case arose from a Ponzi scheme perpetrated by Marsha Schubert, operating as "Schubert and Associates" (Schubert). Defendants Marvin and Pamela Wilcox were among the appellants in an earlier case that appealed summary judgments obtained by the plaintiffs on the theory of unjust enrichment against 158 "relief" defendants who had received more money than they invested in the scheme. Plaintiffs had sought to recover all amounts the relief defendants had received from the scheme in excess of their original investment. On remand, the state Department of Securities and the Receiver (Department) moved for summary judgment against the Wilcoxes on grounds that they were not entitled to the equitable relief provided for innocent investors because they were partners with Schubert and were actively involved in the check-kiting scheme operated by Schubert that supported the Ponzi scheme. In response, the Wilcoxes disputed that they were partners with Schubert. They stated that they were not aware of the existence of a Ponzi scheme in their dealings with Schubert. The trial judge granted partial summary judgment in favor of the plaintiffs on the issue of liability, finding that there was no genuine issue of material fact pertaining to the liability of the Wilcoxes on the Department's unjust enrichment claim. The trial judge found that by virtue of their participation in the Schubert check-kiting scheme, the Wilcoxes were not innocent investors. The trial court found that the Wilcoxes were unjustly enriched by all monies netted from their association with Schubert's Ponzi and check-kiting schemes. The Wilcoxes appealed to the Supreme Court. Upon review, the Supreme Court found that the evidentiary material provided by the Wilcoxes failed to raise disputes to meet their burden to overcome the motion for summary judgment. Accordingly, the Court affirmed the trial court's decision. View "Depart. of Securities ex rel. Faught v. Wilcox" on Justia Law