Saturday, May 27, 2006

MONSTER PONZI --
Brick Kane, the court-appointed receiver for Lewis' holdings, testified that Lewis took in $311 million between 1985 and 2003.

The judge asked how Lewis could keep up his scheme for nearly two decades.

"As long as you're able to raise money and keep paying the promised annual or monthly payments, you can keep going until you implode," Kane said. "And Mr. Lewis was about to implode when he was arrested."

Lewis told investors he was earning returns of 18 percent to 40 percent by leasing medical equipment, financing purchases of medical insurance, making commercial loans and buying and selling distressed businesses.

But prosecutors alleged that instead Lewis was using money from new investors to pay off the original ones -- something known as a Ponzi scheme.

Kane testified that some early investors did receive money back, leaving the total loss at $156 million.

Defense attorneys, however, have argued that the net loss to investors was much lower.
He got 30 years, and has to pay the $156 million to the victims in restitution.