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To fuel $53 million Ponzi scheme, Pinellas man stole parents' identities, feds say

TAMPA — Only two years after being released from prison for fraud and still on probation, Michael Greenberg was at it again, federal officials say.

Greenberg, 50, of Largo was arrested and charged with defrauding his family, friends and investors in a $53 million Ponzi scheme that began in 1998, the U.S. Attorney's Office said Friday.

He lied and deceived others, and stole his own parents' identities, to persuade more than 30 banks, investors, family members and the Small Business Administration to give him money to fuel the fraud, according to a complaint filed Thursday in the U.S. District Court for the Middle District of Florida.

Greenberg did make some payments back to investors during the Ponzi scheme, officials said, but still managed to steal more than $15.5 million of their money.

Neither Greenberg nor his attorney could be reached Friday evening.

Greenberg committed the fraud in the same manner he had several years before, the complaint said.

In 1992, Greenberg was sentenced to 46 months in federal prison for wire fraud and money laundering. When interviewed by agents in 1990, he admitted stealing more than $1 million from his father, using his family's auto salvage business to his advantage and swindling money from others, the complaint said.

He was released from prison on June 21, 1996.

Two years later, it started again, officials said, when Greenberg obscured his criminal past to obtain an automobile dealer's license and to start Pure Class, a luxury auto business in Largo.

The business based on lies equipped Greenberg to build his fraud, the complaint said.

Greenberg stole his mother's and father's identities to mortgage their house and use their real estate holdings as collateral to obtain $7.5 million from two banks, the affidavit said. In order to do this, the complaint said, Greenberg stole a notary stamp and forged signatures of his parents and the notary.

Greenberg also is accused of assuming the identity of an Alamo rental car manager by creating a fraudulent e-mail account to show an investor that the manager had cars ready to sell to Greenberg.

At banks, Greenberg sometimes used titles of luxury vehicles he didn't own — including a Bentley, a Ferrari and a Lexus — as collateral, the complaint said.

He lured other investors into risking large amounts of money with quick returns from initial investments, but he eventually stopped payments, the complaint said.

Greenberg swindled his father-in-law, Robert Sutton, out of $1.3 million after Sutton took out a $500,000 mortgage on his home and took an additional $800,000 from savings to invest with Greenberg, officials said.

Sutton had previously invested with Greenberg during the first scheme in the '90s, and made about $5,000 on his $50,000 investment, the complaint said.

Officials said Greenberg also bilked more than $1 million out of Ronald Giglio, a corporate officer for SimDag Properties, which was the company slated to be the developer of the Trump Towers Tampa.

Shelley Rossetter can be reached at (813) 226-3374 or srossetter@sptimes.com.

To fuel $53 million Ponzi scheme, Pinellas man stole parents' identities, feds say 03/26/10 [Last modified: Saturday, March 27, 2010 12:27am]
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