The whole world is talking about Bernie Madoff and his $50 Billion Ponzi Scheme, and while the worlds been watching Bernie Madoff, we’ve had our own major Ponzi Scheme going on right under our noses.
Fox News, KPVI, and KIFI TV8 all have news stories buzzing about Daren Palmer and his Idaho Falls business that appears to have milked over $40 Million from investors. Now that’s a chunk of change!
- http://www.localnews8.com/global/story.asp?s=9919935
- http://www.foxnews.com/story/0,2933,480750,00.html
- http://www.kpvi.com/global/story.asp?S=9736211
Daren apparently ran the operation right under the SEC’s nose as he never registered with the SEC for any investment trading.
A Ponzi Scheme typically where people invest money with a promise of financial returns, and future investors cover the returns of earlier investors. Typically there is no product or good being sold or used by consumers. Most often these are investment schemes. Often times the person running the fund will siphon off investments to support their sometimes lavish lifestyle. Unfortunately, investors left still in at the end ends up with little or nothing.
According to the SEC government website, the complaint filed aleges Palmer “raised at least $40 million as part of a Ponzi scheme that has defrauded at least 55 investors. According to the Commission’s Complaint, from at least 1996 until October 2008, Palmer and Trigon defrauded investors by representing that invested funds would be used in a riskless trading program that earned annual returns of 20 percent or more…”
The complaint also aleges that “Palmer and Trigon were using funds put into the program by later investors to pay fictitious returns to earlier investors in a classic Ponzi scheme. The Commission’s Complaint further alleges that Palmer used investor funds to build a partially completed $12 million home in Idaho Falls, Idaho, to purchase snowmobiles, to pay himself compensation of $25,000 to $35,000 a month, and for other personal expenses. The Complaint also alleges that while Palmer told investors he was licensed to sell securities, he has never been licensed to sell securities and that neither Palmer nor Trigon is registered with the Commission in any capacity.”
It looks like this is a slam dunk. But in our legal system, anything can happen. It’s sad that people often trust their lifetime earnings to a friend or family member only to loose everything in a scam like this.
Some tips:
- Know where your money is going and what it’s being used for.
- Stick with reputable organizations when it comes to managing your money.
- Do your due-diligence on any investment opportunity.
- If it’s not a traditional stock or mutual fund, you are likely going to have additional risk involved. Make sure you’re willing to take that risk.
- If it sounds too good to be true…
Does anyone have any business experience or know this man? Please share with us some insight. Does you know someone who’ll lose money because of him? What do you think they should do with him?
(I couldn’t find a picture anywhere of this man. If someone has one, please post a link.)
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Gato got runned over by Marcus many moons ago. Be ye daft, 2486? 
Let's have a new poll, alright, Joe?
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{ 17 comments… read them below or add one }
I saw a good suggestion in the chat box that I’ll expound on – I think they ought to sentense him to 30 years of working two part-time minimum-wage jobs to support himself, and make him live in government assisted houseing.
Set up a house arrest curfew for 8:00pm during the sentense, and have himspend his saturdays volunteering at a local homeless shelter.
There is a picture of Palmer on the KIDK site. It’s not real good, but shows him standing in a doorway. It is a recent picture, taken after this news first broke. I don’t know how to do links, so can’t provide one for you.
Here’s the picture:
http://media.kidk.com/images/Darren_Palmer.jpg
you know whats funny, is i helped wire up his monster house. The whole time he had such a attitude about not being talked to by the workers there on the project. Him and his wife would roll in with there big Cadalliac and BMW trucks and walk around for hours complaing that stuff ‘just wasn’t getting done fast enough’
kind of gives me a sick feeling of satisfaction hearing this story break.
what else is how he built this ‘temple’ in a area that is going to be effected during tax time.
what a jack *&%
Unfortunately that’s how a lot of people with that kind of money act. We can take comfort in the fact that what goes around comes around and it won’t be long until Mr Palmer’s got nothing but the clothes on his back.
I don’t really feel sorry for those who invested with him as they should have known better by the old saying “if it sounds too good to be true it probably is.” But I do feel sorry for the contractors and others who were building his house and now aren’t going to get paid. I know one guy who put about $40,000 of material into that house and still hasn’t been paid. Obviously he is one of the guys with liens on the house now but that doesn’t do much for him in the meantime and in this current economy losing $40,000 is about to sink his business.
Rumor going around town is that BA Wackerli family lost a lot of money on Palmer, and that is why they are the only major car dealership around here to be cutting back and going bankrupt. The Harris family of Idaho Falls magazine is also rumored to have lost a lot of money on Palmer.
Anyone else?
I heard today that one of the local car dealerships invested their employees retirement money with Palmer.
WOW, Idaho Native! Which one? Those poor employees. And the poor dealership.
Everyone rumors the Wackerli dealership invested money with Palmer, but I’ve yet to see real information or a press release from Wackerli whether or not this is true. At this point the rumor has become so rampant it would behoove them to come clean and issue a press release. We bought from them last year, and planned to again this year, but now I’m hesitant b/c I don’t know their future plans. At lest their employees should know the deal.
Taylor Chevrolet in Pocatello I believe it was. Something like 4 million dollars he lost. But according to Mr. Taylor it’s not going to affect his business and evidently he’s got the money to keep his business up and running. They listed a bunch of people on the news this morning that lost big money with this low life. Also, the news said Palmer knew he was going to get caught it was just a matter of time.
My mistake….actually it’s Taylor Chevrolet of Rexburg. Here’s a link listing some of the businesses that lost big with Palmers scam. http://www.kpvi.com/global/story.asp?s=9950036
Beyond the millions jerked out of this community and whatever sentence is laid down on the accused is the unrepairable effect on the way of life here. This damage may go unnoticed by most but it fundamentally undermines a trust and an innocence that was once a beautiful part of the atmosphere here. Idaho Falls is growing up.
i agree. i think that what has happened in very unfortunate. these poor people were oblivious to what was going on. but it has happened and i think that everyone should try to make the best of what they have now. the past is the past, which is very unfortunate in this case.this is a very terrible situation for everyone a part of it. how would u feel if u were the poor, betrayed family of palmer?
http://abcnews.go.com:80/Business/wireStory?id=7294651
As my buddy was telling me over a beer a few days ago when we were discussing Mormons and their predilection to Ponzi schemes: “Don’t you just love it when those bastards are f—ing each other.” That got a thumbs up from everyone within earshot.
Little bit of an issue with Mormons? Ex-Mormon by chance?
Most likely.