Money Crooks Beware

Yesterday in New York, a judge sentenced Bernie Madoff to the maximum penalty of 150 years in prison for his fraud and ponzi scheme that bilked investors out of some $65 Billion. The court heard testimony from nine investors - some of whom have lost their entire life savings from the case. While the size of this case is so incredible and may not be repeated, it is, unfortunately, probably not the last time this sort of thing will happen. It certainly isn't the first and reminded me of issues in our own industry.

Earlier I'd written about the case of Ed Okun. While a scheme like Madoff's gets all the press because of the size and severity of the case, Mr Okun was no less guilty of frauding investors - some, again, out of their lifelong savings. In a scheme designed to defraud clients out of millions of dollars through false pretenses, Okun started buying 1031 exchange companies and, over the course of two years, began raiding the client accounts. He used the money to buy more 1031 Qualified Intermediary companies to keep the ponzi scheme running as well as fund his lavish personal lifestyle. Mr Okun will be sentenced in August and faces up to 400 years in prison.

While the money is gone, at least the courts are finding the heart and determination to sentence these "white collar" criminals to the remainder of their lives in prison. It does nothing to bring back the life savings of the former clients from whom they stole but at least the crooks are paying for what they've done. Maybe, just maybe, it will stop a few future would-be criminals from making the same mistake. Perhaps too, it will bring further highlight to the fact that you need to know who you are dealing with and do your due diligence before allowing them access to your money.

1031 exchange Real Estate radio show

This Wednesday, June 24th from noon to 1 PM Pacific time, 1031 Corporation will be on the air live at KFNN 1510 in Phoenix. Carol Croft and I are guests on a show hosted by Entrust Arizona's JP Dahdah and Timarie McClendon.

We plan on discussing how 1031 exchanges provide a way to defer capital gains taxes and preserve more of your principal in your real estate investments. We will also be discussing some recent trends in the industry and provide some information on the legislative landscape as it relates to Qualified Intermediaries.

You can listen to the show live here or, if you've missed this post or are not available at that time, Entrust Arizona provides a link to past shows they've hosted.

We hope you'll take the time to listen and, perhaps, increase your financial literacy as it relates to this important tax strategy!

Also, if you have a real estate license in Arizona, we are offering, along with Entrust Arizona, Four Hour Continuing Education course on Thursday, June 25th from 11 AM to 3 PM. We even provide lunch! The class is in Entrust's state-of-the-art facility at 20860 N Tatum Blvd, Ste 240 in Phoenix.

The first 2 hours is our class offering, Everything You Wanted to Know About 1031 Exchanges. In addition to providing the basic rules of IRC Section 1031, this class provides a basic understanding of the Reverse and Improvement exchange process. We also discuss the role of the Qualified Intermediary and investor motivations for a 1031 exchange. This class also highlights strategies involving the section 121 Primary Residence rules used in combination with a 1031 exchange.

The second 2 hours will be Entrust's class, Show Me The Money! How to Buy Real Estate with Your IRA/401k. Did you know you could invest in real estate with your IRA? Do your clients? You can even get a mortgage with your IRA or partner together with other retirement accounts or individuals. Your choices are endless. This workshop teaches real estate agents & brokers how to tap into the trillions of dollars available within retirement plans. The class teaches attendees the important elements of Self-Directed IRAs so they can add this hot topic to their current marketing plan. You will walk away with a clear understanding of how you can position yourself in a true advisory role with your clients.

For more information about 1031 Corporation, please call us at 888-367-1031. For more information about Entrust Arizona, please call (480) 306-8404.