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Mantria Corporation Ponzi scheme

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The Mantria Corporation Ponzi scheme has been described as the "biggest green energy scam" in United States history.[1] It has gone unprosecuted by the Department of Justice, though a Federal judge in the Securities and Exchange Commission's civil case found Mantria had scammed more than $54.5 million “by egregiously, recklessly, knowingly, and shamelessly perpetrating a fraudulent scheme” that used “misrepresentations, omissions, and blatant lies to induce unsuspecting and unwitting victim investors to liquidate the equity in their homes and take out bank loans to invest in Defendants’ scheme, which was nothing more than smoke and mirrors.” On November 16, 2009, the U.S. Securities and Exchange Commission charged four people who targeted those nearing retirement age who were seeking real estate and "green" investments. Many of these securities were offered by Mantria Corporation.

The SEC said Mantria's environmental and real estate initiatives had not generated any significant profits, and returns paid to investors had been funded from other investors' contributions. They targeted those nearing retirement age to finance the "green" initiatives of Mantria Corporation, such as a “carbon negative” housing community in rural Tennessee, waste-to-energy plants, and a “biochar” charcoal substitute made from organic waste. Mantria Corporation operated using 55 different LLCs in the scheme, which made it very difficult for investigators to follow the funds.[2]

Mantria Corporation

Mantria Corporation described itself in numerous press releases and on the web as a $128 million company focusing on green community development, socially responsible investing, distressed real estate fund management, mortgage banking, renewable energy, music and entertainment and philanthropy. Mantria also described its foundation called Mantria Green – a set of pioneering principles for developing premium land and real estate with carbon emission offsetting and environmentally conscious design.[3][4] Some of the companies Mantria operated as include: Mantria Corporation, Mantria Industries, Eternagreen, Carbon Diversion, Mantria Realty, Mantria Communities, Mantria Investments, Mantria Records, EternaGreen Global, Earthmate Technologies, Eternagreen Capital, Clean Energy Components and many others.[5] Based outside of Philadelphia in Bala Cynwyd, Pennsylvania, Mantria Corporation had additional offices in Tennessee and Florida.

Mantria & Speed of Wealth, LLC.

Mantria offered its investments primarily through Speed of Wealth, LLC and its principals,[6]

Mantria Ponzi scheme

On November 16, 2009, the U.S. Securities and Exchange Commission charged four people who targeted those nearing retirement age who were seeking real estate and “green” (environmentally-friendly) investments. Many of these securities were offered by Mantria Corporation.

The SEC said Mantria's environmental and real estate initiatives had not generated any significant profits, and returns paid to investors had been funded from other investors' contributions.

In July 2011, Denver’s 5280 Magazine wrote about Mantria and Speed of Wealth in "The Biggest Green Scam in America".[1]

On August 5, 2011, after nearly 21 months, Federal Judge Arguello ruled the Mantria case a ponzi scheme. Arguello called Mantria a Ponzi scheme operating with "sociopathic greed". The judge was to the point in stating that Mantria scammed more than $54.5 million “by egregiously, recklessly, knowingly, and shamelessly perpetrating a fraudulent scheme” that used “misrepresentations, omissions, and blatant lies to induce unsuspecting and unwitting victim investors to liquidate the equity in their homes and take out bank loans to invest in Defendants’ scheme, which was nothing more than smoke and mirrors.”

On September 3, 2015, the Department of Justice[7] charged three people affiliated with the Mantria Ponzi scheme. Those accused are Mantria Corporation founders and executives Troy Wragg and Amanda Knorr, as well as unlicensed securities broker Wayde McKelvy. The charges included conspiracy to commit wire fraud, conspiracy to commit securities fraud, securities fraud and seven counts of wire fraud.[8] In Georgia Troy Wragg had been arrested and Wayde McKelvy was arrested in Colorado. Amanda Knorr will turn herself in at a later date.[9]

On May 24, 2016, Amanda Knorr pleaded guilty to two charges of conspiracy, seven counts of wire fraud and one count of securities fraud. Knorr may receive a maximum prison sentence of 240 years, a fine of $12.5 million and/or an order make full restitution. Sentencing was expected to take place on November 3, 2016,[10] but has been rescheduled for May 25, 2017.

A change of plea hearing occurred on March 2, 2017 where Troy Wragg pleaded guilty to 10 counts of conspiracy, wire fraud and securities fraud. The maximum penalty is 240 years in prison, 5 years supervised release, a $12.5 million fine, and a $1000 special assessment.[11][12]

References

  1. ^ a b "The Biggest Green Scam in America". 5280 Magazine. Retrieved July 1, 2011.". www.5280.com/magazine/2011/07/biggest-green-scam-america. 
  2. ^ "Mantria of Bala Cynwyd and principals Wragg and Knorr accused in Ponzi scheme". http://www.bizjournals.com/philadelphia/stories/2009/11/16/daily15.html?page=all.  External link in |website= (help);
  3. ^ "Linkedin.com Mantria Industries". https://www.linkedin.com/company/mantria-industries.  External link in |website= (help);
  4. ^ "WebArchive.org Mantria Industries - Eternagreen". https://web.archive.org/web/20091202014622/http://www.eternagreen.com/about-us.  External link in |website= (help);
  5. ^ "THE MODERN PONZI: Federal Judge Orders Parties Not To ‘Harass’ Receiver In Mantria/Speed Of Wealth Case; Dozens Of Companies Now Ensnared In Litigation". http://patrickpretty.com/2010/05/04/the-modern-ponzi-federal-judge-orders-parties-not-to-harass-receiver-in-mantriaspeed-of-wealth-case-dozens-of-companies-now-ensnared-in-litigation/.  External link in |website= (help);
  6. ^ "Colo. man accused in 'green' Ponzi scheme calls allegations 'ridiculous' - Philadelphia Business Journal". Philadelphia Business Journal. Retrieved 2016-05-29. 
  7. ^ "Indictment Charges Three People With Running $54 Million "Green Energy" Ponzi Scheme". Department of Justice. Retrieved 8 September 2015. 
  8. ^ "Three people were charged". Washington Post. Retrieved 8 September 2015. 
  9. ^ "3 charged in $54 million green-energy Ponzi scheme based on trash-to-fuel promise". US News & World Report. Retrieved 8 September 2015. 
  10. ^ Call, The Morning. "Hellertown woman admits guilt in $54M Ponzi scam". themorningcall.com. Retrieved 2016-05-29. 
  11. ^ United States District Count for the Eastern District of Pennsylvania, United States of America v. Troy Wragg: CRIMINAL NO. 15-398, January 30, 2017
  12. ^ Two years out of Temple, he built a $54 million Ponzi scheme, Accessed: March 2, 2017, http://www.philly.com/philly/news/pennsylvania/Temple-grad-I-built-a-54-million-green-energy-Ponzi-scheme-within-two-years-of-graduation.html