Ponzi Scheme Never Ends, General Says
CHICAGO (CN) - Lake Forest Partners swindled $3.5 million from a retired Air Force general, then ducked judgment by transferring the money to its affiliates and paying it to other investors in its Ponzi scheme, Gen. John Chair Jr. claims in Federal Court.
Chain, 75, of Forth Worth, says that in July he "obtained multimillion dollar judgments against Lake Forest" and its officers for unpaid loans, but that Lake Forest moved the money to duck judgment.
In his original lawsuit, Chain claimed that in 2005 Lake Forest Partners and its principals Christopher French, Albert Montano and Dr. Mark Weissman, took $3.5 million from him with the false promise it would be used to develop uninhabited islands in the Bahamas, where they would also provide him with two home lots. Chain says that court entered a judgment against Lake Forest, French and Montano for $6.7 million, and a judgment against Weissman for $6.7 million as well.
His latest claims states that in the same year he loaned Lake Forest Partners the money, it transferred more than $1.8 million to affiliated entities Tec Development, Great Prairie Ventures, Ventana Financial Resources and Buzz Enterprises.
Chain says that Lake Forest had no assets at the time, owed $5 million, and was "insolvent at the time of each of the transfers," or "rendered insolvent by the transfers."
Chain claims that in a classic Ponzi scheme, Lake Forest used his money to pay other investors, including one woman who gave $1 million to Lake Forest and received $550,000 in profits after only 3½ months. Chain says those "profits" were actually his money. The woman who allegedly received that money, Sandra Goeken-Miles, is also named as a defendant.
Chain seeks reimbursement and wants Lake Forest Partners enjoined from transferring any more money.
He is represented by Jonathan Cyrluk with Stetler & Duffy.