Woodbridge class-action suit expands to Treasure Coast brokers Klager, Gilchrist, Hannah
The civil suit filed in federal court in
In a
Unlike the
"We believe that those individuals are culpable and have a responsibility to these clients who they solicited investments from,"
More: Woodbridge's alleged Ponzi scheme hits home for
"At this point, we're giving the sales reps the benefit of doubt that they weren't knowingly engaged in a Ponzi scheme," Butler said. "At best, they dropped the ball. At worst, they ignored blatant red flags."
"We may well be titled the Ponzi scheme capital of the world in
The suit was filed
Klager, whom the suit alleges sold
More: Beware of these scams
"I have my money and my family's money in it, too," Klager said. "I wouldn't have put more of my own money into it back in October if I knew (the bankruptcy) was going to happen."
The amount of money Klager made, according to the lawsuit, shows brokers who sold Woodbridge investments may have profited more from the investment than originally reported.
The lawsuit claims Woodbridge paid brokers such as Klager 9 percent interest on money invested, while brokers offered investors 5 to 8 percent interest and kept the difference. All told, Woodbridge paid its brokers more than
The suit also names Klager's wife, Michele, who is listed as the company's assistant treasurer and secretary as a defendant.
"Al and
Meanwhile,
Klager disputes the
Asked what research he did to verify Woodbridge's claims before investing other peoples' money, Klager said he visited one of Woodbridge's
"They obviously are legit," Klager said he thought at the time. "They had to be."
Klager is confident investors will get their money back; but Butler is more cautious, given some of that money is already gone.
At least
"As with any Ponzi scheme, the likelihood of recovering enough assets to make all investors whole is at best a tough proposition," Butler said.
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