L.A.'s Jewish Journal is calling Bernard Madoff's many Jewish victims "Swindler's List." Turns out not enough people were trucha con el Salvatrucho de Norwalk. Here's the government's version of what happened.
Starting two years ago, advertisements in Spanish language magazines and the internet lured people to invest in a real estate company called Best Diamond Funding (pick up any of these rags and you'll see the easy money schemes, real estate investment deals and the like). The company's offices were in Huntington Park, next to a Christian bookstore. Milton Retana, a native of El Salvador, ran the investment firm. His wife ran the bookstore.
Retana amassed about $62 million from about two thousand people (the U.S. Justice Department didn't describe the alleged victims, but it's safe to say they're likely all Spanish speaking immigrants from Central America and Mexico). Investors gave Retana their savings on promises that he'd give them a 7% return on their money every month. That's more than an 80% yearly return on the initial investment! He also persuaded some to invest from equity loans on their homes. Nothing like a financial meltdown to sap a get rich quick mood, huh? Retana told potential investors the company employed dozens of real estate agents to buy properties, fix them up, and sell them at a profit.
It didn't. Retana ran a textbook Ponzi scheme. He used the money from new investors to pay the old investors and at times used the investor's own money to pay them "dividends." Federal agents raided the company's Huntington Park offices and the Christian bookstore in October of this year. They found $4 million dollars in cash. Agents froze $8 million in Best Diamond Funding and Milton Retana's accounts.
The FBI suggested the Christian bookstore played a role in the scheme to hook victims into the allegedly fraudulent investments. A perceived common bond of religion, language, and ethnicity may have convinced many to give up their life savings.
Milton Retana's lawyer didn't return a call for comment.
Trucha: someone's who's street-wise, who can't be fooled.
Salvatrucho: nickname for a Salvadoran.
(Photo Credit: Bernard L Madoff walks down Lexington Ave to his apartment December 17, 2008 in New York City. By Don Emmert/AFP/Getty Images)
4 Comments
Your comment reminds me of Phillip Rodriguez's latest documentary, Latinos '08. In it a Chicano scholar who'd participated in the 1960s civil rights movement said something that's changed about his perceptions of Chicanos is that he used to think the ethnic group was morally superior. He doesn't believe that anymore. Like any other people, given the opportunity Chicanos can lie, cheat, steal and they can succeed and shine.
Hey Adolfo,
Hope you're doing good my man. Really great article and very sad to hear these type of stories within our communities. As a native born son from El Salvador, it hits even harder when you know it is fellow countrymen pulling these kind of scams. Hope you do a follow-up on this story.
Hey Carlos! I head an expert on the radio talk about the element of trust between the swindler and the prey. Both rely on it to make money.
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Ophelia Chong says :
Unfortunately swindling knows no boundaries. If there was a common bond between classes, ethnic groups, religions, genders, races, it would be the lure of making money and the con artists that take advantage of affinity marketing.
The Madoff scandal has claimed small and large, and already a suicide (Thierry de la Villehuchet, a hedge fund investor), not counting the families now wiped out.
Thank you for the post, you have to wonder, if you can't trust your brother, who can you trust?