A $5 million Florida Ponzi scheme used religion to get money for luxury living, feds say
Claims of shared religious beliefs as well as too-good-to-be-true statements about a Florida company powered a $5.3 million Ponzi scheme, according to twin filings in West Palm Beach federal court.
The Securities and Exchange Commission made the civil filings, charging Henry Abdo, 46; Abdo’s company, Titanium Capital; and Carol Ann Barsh of Edwardsville, Pennsylvania with perpetrating the scheme. The SEC also included Abdo’s wife, Ganna Migulina, and relative Elias Abdo as defendants who received at least $330,000 from the scheme.
The U.S. Department of Justice made the criminal filings, indicting Abdo with two counts of wire fraud. Abdo has pleaded not guilty. Abdo, a citizen of Lebanon with a U.S. visa, has been detained after a detention hearing before U.S. Magistrate Judge Bruce Reinhart.
“Mr. Abdo has no prior criminal history,” Reinhart wrote. “But, he also has no ties to the United States. He has no stable residence anywhere in the world. He travels constantly.”
And, Reinhart noted, the amount of “allegedly diverted funds” to which Abdo might have access to gave the magistrate pause. During the detention hearing, Abdo “suggested ... that investor funds were properly handled and were held in a different Titanium entity in the UK.”
The SEC and the indictment say something else.
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Using Guarantees and God?
“None of the $5.3 million raised ... was used by Abdo or Titanium for the stated investment purposes,” the SEC complaint said. “Most of that money is now gone, used instead by Abdo and Titanium to make Ponzi-like payments to earlier investors, transfer funds to Abdo’s relatives and related parties, and pay Abdo’s personal expenditures, such as extensive travel through Europe and Western Asia and cash withdrawals at casinos.”
Abdo registered Titanium Capital with the state of Florida on July 30, 2014, using a Sanford address, 113 Magnolia Ave., Suite 204. Titanium’s address of operation would be changed to locations in North Palm Beach; Deltona, including a home once owned by Titanium registered agent Sharon Hyder; and, as of Aug. 14, 1041 Maytown Rd., a mobile home in Osteen owned by Kateryna Karsashevska Hyder, relationship to Sharon undetermined.
The indictment says Abdo, Titanium’s prospectus and website pushed several lies, including that “Titanium is part of a multi-billion dollar holding company;” that Titanium was registered with the SEC; that Titanium had “developed and operated a proprietary multi-currency foreignexchange platform;” and that Titanium guaranteed a 15% rate of return for investors. (Investing red flag: guarantees of return. All investments involve risk. There are no guarantees.)
The SEC said this lured in 162 investors from around the world who thought their investments “were used to secure loans to third-party traders using “a proprietary multi-currency exchange platform” and that Titanium had never registered “a single monthly loss.” (Investing red flag No. 2: claiming an undefeated business record over several years.)
“Abdo often referenced his faith to exploit the trust of religious investors,” the SEC complaint said. “For example, in 2021, a promoter introduced Investor 6 (a 49-year-old North Carolina resident) to Abdo to discuss Titanium. Investor 6 was not convinced he would invest until Abdo told him they were of the same faith. Abdo’s shared affinity made Investor 6 trust Abdo and believe his assertion that Titanium was a safe investment.
“Similarly, Investors 7 and 8 (a Florida couple in their 50s) were introduced to Abdo in 2015 at a church in Turkey,” the SEC continued. “Over the course of three years, Investors 7 and 8 signed several Subscription Agreements with Abdo, investing approximately $190,000.”
The SEC complaint also says that an 87-year-old California man “liquidated a brokerage account” and “cashed out his savings” to invest $330,000 with Titanium in June 2022. By Aug. 31, 2022, the complaint said, Abdo had spent $89,000 of that money.
Using a Titanium debit card, Abdo “made charges at hotels in Malta, Austria, and Turkey, as well as numerous charges to Hotels.com for unknown locations; purchased various flights from different airlines; and made food, clothing, and other shopping purchases.”
Court documents in the criminal case say a Pennsylvania-based victim wired $35,000 to Titanium on Feb. 26, 2020, and bank records say Abdo dropped $8,000 on travel, $1,800 on food and retail, and moved $25,000 to nine friends.
“As recently as September 2023, as part of an FBI investigation, Abdo directly offered to sell Titanium securities to an undercover agent,” court documents say.
