SEC targets Ponzi schemers preying on the prayerful

Sometimes having faith isn't enough. A vengeful and less distant authority helps. The US Securities and Exchange Commission has been active in the two-and-a-bit years since the Madoff scandal broke and reacquainted us all with the term Ponzi scheme. The SEC was caught asleep at the wheel when the $65 billion fraud was building. But having been stung by the criticism of its failures, the SEC has been working with a vengeance at hooking the small fish that swim in similar waters.

Madoff targeted many investors, among them Jewish individuals and charities supporting Jewish causes. In its latest sweep, the SEC closed down two other Ponzi schemes that preyed on other faith-groups. It sought an emergency court order to close down a scheme in which, it alleges, that for the past two years, a fraudster raised more than $7.5 million from investors by claiming to be a hedge fund manager. His aim was to extract funds from Persian-Jewish families in California. In a separate action, the SEC charged a self-described "social capitalist" with bilking socially-conscious investors in Christian church congregations across the country, raising about $11 million.

Such actions, and the resulting disgorgements, may not make up for the billions lost through the SEC's Madoff mistakes. But they may go some way to reviving faith in Washington.

Source document: The SEC's actions are detailed in a news release for one and then the other.