A Philadelphia estate lawyer is accused of heading a Ponzi scheme that defrauded investors in New Jersey, Pennsylvania, New York and three other states.
The $8.5 million scheme involved the sale of three-year notes with the false promise of 12 percent annual rates of return, according to Thomas Calcagni, director of the N.J. Division of Consumer Affairs.
“Many of the 73 victims targeted were elderly and retired investors who thought they were making sound investments,” Calcagni said. “They were hoping to expand upon their life savings for the benefit of themselves in retirement and for the benefit of their families.”
Michael Kwasnik, 42, is charged with misusing the money to pay other existing investors and for his law firm’s expenses.
Kwasnik, who has a law office in Cherry Hill, denied any wrongdoing through his lawyer. Attorney Rocco Cipparone said he anticipates “a full airing of the evidence” will show Kwasnik did nothing wrong.
New Jersey Attorney General Paula Dow said the state will try to get defrauded investors their money back.
Prosecuting major financial fraud cases is a top priority, said Stephen Taylor, director of the N.J. Division of Criminal Justice.
“When the victims are elderly or otherwise vulnerable, they need to be protected,” Taylor said. “We need to deter this type of conduct by aggressive investigations and prosecutions like the Kwasnik case.”