Mortgage Fund ’08 Called Ponzi Scheme

     MARTINEZ, Calif. (CN) – The Mortgage Fund ’08 is a $64 million Ponzi scheme, and one of its perpetrators admitted it, perhaps inadvertently, investors claim in Contra Costa County Court. The two plaintiffs say they lost $1.4 million to co-defendants Bar-K Inc., Walter Ng, and his sons Barney and Kelly Ng.

     One plaintiff says that when she tried to withdraw some of her investment, she was told she could not do it because of “liquidity problems.”
     She says, “Defendant Kelly Ng specifically stated to plaintiff Linda Grassi that up until September 2008, Mortgage Fund ’08 had been taking in enough money in new investments to pay the ongoing interest obligations due to current investors. … Such statements by defendant Kelly Ng, especially when coupled with the documentation that was intentionally obfuscating … clearly and unequivocally establish that Mortgage Fund ’08 is nothing more than a Ponzi scheme that is being used to dupe existing and new investors.”
     Plaintiffs claim that “Mortgage Fund ’08 is a limited liability company organized by Bar-K and the individual Ng defendants solely for the purpose of borrowing money from people like plaintiffs and loaning that money to borrowers in connection with real estate transactions, and that Mortgage Fund ’08 does not actually possess any of the assets purportedly been [sic] provided to plaintiffs as security.”
     The plaintiffs say “that over $64 million has been invested by investors in defendant Mortgage Fund ’08,” and that the money was “used to lend money on approximately 18 real estate transactions.”
     Plaintiffs are represented by Robert Huddleston of Walnut Creek.

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