A businessman who ran a $50 million iPod investment scam was sentenced to 17 years in prison by a federal judge in Miami.
Andres Leonel Pimstein, who pleaded guilty to a dozen wire-fraud counts in December, must also turn over 5,540 of the Apple devices and a Fidelity investment account totaling $138,522, U.S. District Judge Adalberto Jordan said.
It was a simple enough scheme: Pimstein bough iPods at wholesale prices and resold them to a department store chain in Chile. The chain, named Ripley, was supposedly going to buy the iPods from him at above-market rates.
But there was one slight problem: it was a Ponzi scheme.
‘In exchange for their work, Pimstein made `interest payments’ to the agents that were purportedly derived from the sale of products to Ripley,” according to the criminal information charging him with wire fraud. ‘The agents, in turn, distributed a percentage of the `interest payments’ to their investors and retained the difference as a commission.”
Pimstein was accused of creating false invoices to document the purported purchase and sale of the iPods.
Via Miami Herald
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