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Seniors who were fraud victims get restitution

Katheryn Houghton Daily Inter Lake | Hagadone News Network | UPDATED 8 years, 9 months AGO
by Katheryn Houghton Daily Inter Lake
| June 19, 2016 6:30 AM

Six western Montanans who were scammed out of $500,000 will see partial restitution from the state.

Monica Lindeen, the state commissioner of securities and insurance, announced the order of more than $200,000 in restitution to Montana seniors who were victims of a pair of major financial frauds.

Polson and other Western Montana seniors who were victims of recent scams will receive roughly $186,000, according to Sanjay Talwani, the office’s press secretary.

Lindeen’s order came during World Elder Abuse Awareness Day.

“The Restitution Fund is a big step toward getting some money back to victims of financial fraud, but it doesn’t come close to recovering everything,” Lindeen said in a prepared statement. “That’s why we work hard to educate seniors and their families, to give them the tools to help prevent anyone else from losing their life savings to financial criminals.”

The latest order brought the total paid by the fund beyond $1 million. That money has been spread among more than 75 Montanans who were victims of fraud.

The fund was established by the Montana Legislature in 2011. Legislation in 2015 doubled the possible restitution and expanded the potential criminal penalties for financial crimes that victimize seniors or other vulnerable people.

Wednesday’s order gave restitution to victims in two different Montana cases.

One of the scammers was John “Jack” Cross, a Lake County man now in federal prison for wire fraud. He told Polson investors he was putting the money into real estate and other investment, when he actually was using the money for his own personal benefit.

The other scammer was Paul Schumack, a Florida man who defrauded 1,800 investors nationwide in an $80 million Ponzi scheme. Schumack, now serving a 12-year federal prison sentence, told customers they were investing in “virtual concierge” kiosks, like ATMs. He said the machines would let people download movies, order food and more. Schumack and others sold interest in more than 20,000 of the machines. Only 84 machines were ever produced.

Lindeen took part in panel discussion at Flathead Valley Community College on Wednesday afternoon to remind seniors and their families to take steps to protect personal data and to be wary of any investment opportunity that promises large returns for little risk.

“If an offer is too good to be true, it probably is,” Lindeen said in a prepared statement.

To check whether an investment broker or financial adviser is licensed in Montana, call the commissioner’s office at 800-332-6248.

She joined speakers from the Kalispell Police Department and Adult Protective Services.

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ARTICLES BY KATHERYN HOUGHTON DAILY INTER LAKE

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No headline

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