Vance Edwards was a very wealthy man. His great wealth was derived solely from the Edwards Fund that he created and managed. The Fund’s annual return on investment had become legendary among its investors and competitors.

It was not easy to invest in the Fund. Besides requiring a $2 million minimum investment and a $10 million minimum net worth, Vance had to personally approve each investor.

He regularly rejected potential investors who easily met the Fund’s minimum requirements. Each rejection heightened interest in the Fund by other would-be investors. Being accepted as an investor by him was equivalent to being invited into a very exclusive club.

The investors who were lucky enough to be accepted were convinced that each year, no matter what, they would receive at least a 10 to 20 percent return on their investments. Historically, there was never a deviation from the anticipated range of return.

With Vance’s extraordinary wealth, he and his first and only wife, Cynthia, became well known as major philanthropists. Each sat on the boards of well-known charities and educational institutions. They attended those black-tie social fundraisers that were so regularly written about in the Times.

He purchased an ocean-going yacht, a Gulf Stream jet plane, and vacation homes in the United States, Mexico, and Europe. With the Fund’s investors happy with their quarter-annual income payments and the charities enamored by the Edwards continued generosity, their extravagant lifestyle was easily accepted as being reasonable.

Vance had a small group of confidants at the Fund who knew its inner workings. He jokingly called this group his “brain trust.” One member of the brain trust was his younger brother, Charlie.

Vance took his morning walk around the executive offices of the Edwards Fund. He had always been “hands on” and would routinely oversee almost all of the activities of his Fund. He popped his head into Charlie’s office, smiled and asked, “Charlie, how’re the quarterly statements coming along?”

“Pretty much right on schedule,” Charlie responded. “The statements will easily support the target returns.”

Vance laughed to himself as he thought: Target returns. This was all fiction. For the last 15 years the Fund had hardly any real return on its investments. It was an elaborate and well-camouflaged Ponzi scheme. The endless stream of new investment money funded the needed outgoing income stream to the Fund’s investors and also paid for the Edwards handsomely enough for them to maintain their lifestyle. And virtually all of the investors were more than happy leaving their principal investments with the Fund and collecting the quarter-annual income distributions.

Another member of the brain trust was the Fund’s longtime accountant, Leslie Brachman. With Brachman’s brilliant guidance, the Fund produced the quarterly and annual statements the investors received. The statements showed numerous purchases and sales of equities, options and foreign and domestic properties, as well as a solid stream of income. To produce and deliver these statements, the brain trust included two trusted administrative assistants and one very brainy computer nerd, Victor, who to Vance always looked more like a California surfer than the head of an IT department of a financial firm. All of the members of the brain trust were paid very well for their services and, more importantly, for their silence.

Only one other individual knew the secret of the Fund’s continuing success. Other than Vance, the members of the brain trust were not aware of this other person and the important role she played. This person was Vance’s wife, Cynthia. She always had access to Vance and secretly advised him. Vance and Cynthia seemed to have no moral issues with what the Fund was doing; and even if they did, any issues were probably outweighed by the good lifestyle they were enjoying.

Even the SEC and IRS saw no reason to challenge the Fund since it was an exclusive club made up of very wealthy people with significant business experience. The SEC was satisfied since none of the exclusive club members were complaining. The IRS was satisfied that all the parties concerned were promptly paying all the taxes.

Vance knew that those in the brain trust who believed it could go on forever were wrong. This Ponzi scheme could not go on indefinitely. Vance could envision two possible scenarios that could play out: The income stream could start to run dry and the investors would want out if they weren’t receiving their expected return, or an economic panic could start a run on the Fund. In either event, if the Fund crashed there would undoubtedly be a government seizure of assets of the Fund as well as Vance’s personal assets. These scenarios were Vance’s ongoing nightmare.

Vance always worried about protecting his assets if his nightmares were to ever become real. The best he could come up with was to hide money in offshore bank accounts that only Vance and Cynthia knew about and could access.

One morning at breakfast, Vance read in the Times about a recent New York Court of Appeals case that dealt with an individual who ran an investment fund that crashed when it was discovered it was a Ponzi scheme. The individual who ran this fund was Timothy Corcoran. Corcoran, who was going to jail, had his assets seized by the government, and the Court appointed a Receiver to protect the investors and creditors. Eventually, the Receiver then tried to reach the assets that Corcoran’s ex-wife had received as part of her divorce settlement. The Court held that his ex-wife’s settlement was beyond the reach of the investors and creditors including the government. Had Corcoran not divorced, the wife’s assets would have been “clawed back” by the Receiver. Vance put down the newspaper and called his attorney and asked him to read the Court’s decision about Corcoran and give him his analysis of the case. He asked that this matter be kept completely confidential and no one in the lawyer’s firm should know for what client the analysis was being done.

Vance had a brilliant idea. And, it was so simple. He would have Cynthia sue him for divorce. He would appear to be fighting her but would lose the case and let Cynthia “take him to the cleaners.” Anything she won would then be beyond the reach of the Receiver and the government. And if Cynthia and he worked together on this, even though he would go to jail, he and Cynthia would have ample money when he got out of jail.

Arriving home after having dinner at their favorite Upper East Side restaurant, Vance said to Cynthia, “Let’s have a night cap and talk for a while.”

Cynthia poured them both a small glass of forty-year-old Tawny Port and joined Vance on the couch.

“What’s all the mystery?” said Cynthia. “What do you want to talk about? I’m all ears.”

Vance sipped his drink and said, “I think I’ve found a way to protect more of our property when and if the Fund collapses and everyone and his brother comes after us.”

“I’m listening,” Cynthia replied.

Vance explained the Corcoran case to her. Cynthia remained patient but looked at Vance somewhat puzzled.

“We could get divorced after what would appear to others as a bitter legal battle,” added Vince. “We would both have our own attorneys. However, I would make sure you were allowed to be the big winner.”

Cynthia was still uncertain where he was going and said, “What else would we have to do to make this great plan of yours to work?”

“I imagine we would have to live apart and treat each other as if we were going through a blistering separation and divorce. But no matter what, I would always find ways to see you and the children. After the divorce and the settlement of our assets, we could act as if we were a divorced couple who had reached an amicable relationship to go on with their lives.”

Cynthia was never naïve or afraid to act boldly. She was fully aware how the Fund actually worked. And from what she knew about Ponzi schemes, they would eventually fail. She also knew Vance was right; after the failure, the investors and creditors who lost their money would soon be after the Fund and anyone who they thought was involved in the fraud.

As the weeks passed, Vance became obsessed about his plan based on the Corcoran case. When Cynthia wanted to discuss it, Vance would cut her short or shift any discussion to the same two points: The plan could definitely work, and the sham divorce proceedings would have to appear hostile and brutal to everyone. Only Vance and Cynthia could know the true facts.

Cynthia studied the lawyer’s analysis of the Corcoran case. She eventually gave in to Vance’s plan. Cynthia hired Joe Clarkson, the best and most expensive divorce lawyer she could find. Clarkson was as aggressive and as tenacious as a pit bull. Vance hired Hamilton Davis, III, a very well respected lawyer from a top Wall Street firm. Davis had a good reputation and appeared to Vance not to have the ego issues that Clarkson was known to have.

Once the suit was started, Vance, in the privacy of Davis’ office, said to Davis, “I want to have this matter over quickly. I don’t want the media learning anything about my infidelity or my sexual preferences. I know it’s my fault that the marriage fell apart. And most importantly, I don’t mind being more than generous since Cynthia had always been a good wife to me and a good mother to our children.”

Davis cautioned Vance, “You may want to think this through a little more and not direct me to take any actions you would later regret.”

“Ham, I know you have my best interest at heart. But I’ve thought a lot about it, and this is the way I want it. If you want me to sign something that I won’t come after you when the dust clears, just make it up and I’ll sign it.”

The Edwards’ divorce case outwardly was the source of much gossip and speculation. However, to Vance and Cynthia, the proceedings seemed to be going according to plan.

In the divorce settlement, Cynthia received an enormous amount of money, the New York Fifth Ave. condo and the 50-room Palm Beach mansion. Vance agreed to full child support until the children reached age 25, funded with an irrevocable trust. In return for Vance giving up the lion’s share of the property that they jointly owned, Cynthia gave up her right to the type of hefty alimony payments that Clarkson was known to fight for. Cynthia secretly knew when Vance’s world collapsed, any future alimony claim on her part would turn out to be worthless.

After the divorce became final, Vance and Cynthia stayed in touch. Vance also maintained a good relationship with his children.

Surprisingly, Cynthia and Vance would find numerous times and places to secretly meet and have sexual encounters. Surprisingly, their sex life together was more torrid than ever before. Vance had this weird thought that he was now cheating on his wife with his wife. Cynthia had now become his secret lover and mistress.

Almost a year and half after the divorce case concluded, the SEC came without warning and investigated the Edwards Fund. The SEC knew exactly where to look and what to seize in order to acquire the evidence it needed for its case. Vance suspected that the SEC must have obtained information from someone in the brain trust. The SEC pursued its case against the Fund and Vance. The SEC then broadened its net to include Charlie, Brachman, and one of the administrative team of the brain trust.

The Fund’s investors quickly learned there was almost no money, properties or securities held by the Fund. Their principal investments were lost. The Federal Court selected a Receiver to gather together all the assets of the Fund and the personal assets of Vance. These assets were to be liquidated to pay the government, the Fund’s investors and creditors.

It was clear almost from the beginning that Vance would be left penniless and would have to go to jail for a minimum sentence of 10 to 20 years. In addition, Vance would be permanently barred from dealing in the financial markets.

Vance knew he could make it through the jail time since he had the comfort of knowing that Cynthia had a substantial amount of funds in her own name as result of the divorce. When Vance would be released from jail, Vance and Cynthia could live out the rest of their lives very comfortably with what Cynthia had left of her own funds and the more than ample offshore bank accounts they had hidden.

Months after Vance started serving his sentence at a Federal low security prison in Iowa, Cynthia’s periodic calls and visits abruptly stopped. His calls to her were not returned. Letters came back stamped “return to sender.”

* * * * *

Meanwhile, on a bright and sunny day, Cynthia sat back on her beach chair, holding the hand of her now constant companion and young lover, Victor, the brain trust’s computer nerd. She gazed at the blue ocean and the clear sky. The Brazilian beach was so beautiful at this time of the year. And as an added bonus, she now was a citizen of the one country in the world whose constitution prohibits extradition to any other country. She thought to herself that she now had the perfect life. And she owed it all to Vance’s last and best scheme.

Alan Wohl is a retired lawyer and a member of the Watchung Writers Group. He lives in Somerset with his wife, Gail.

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