Vegas couple fined in Ponzi scam

Wednesday, Dec. 1, 1999 | 11:30 a.m.

A federal judge ordered a Las Vegas couple and two others to pay about $3 million in fines and restitution after ruling they had defrauded investors in a seven-state Ponzi scheme.

Shane Vaessen, 55, and his wife Veronika, 53, were ordered to pay back $2.5 million plus interest to more than 100 elderly investors from Florida, Georgia, Indiana, Nebraska, Michigan, Tennessee and California.

They and two other defendants -- Frank Gaines of Indiana and Taft Womack of Florida -- were also fined $100,000 each.

None of the defendants could be reached for comment.

The Securities & Exchange Commission charged in 1998 that they had violated federal securities laws in a Ponzi scheme organized by the Vaessens. In such scams, named for the late conman Charles Ponzi, early investors are paid with funds from later investors, who ultimately loss their money when the pool of new investors dries up.

The SEC said the Vaessens and other defendants fraudulently sold unregistered securities in the Vaessens' International Capital Corp. 2000, or ICC 2000.

A Florida federal judge ruled that the Vaessens and others had told investors -- who put up more than $3.3 million total in amounts ranging from $2,200 to more than $150,000 -- that their money was pooled in bank accounts and used as collateral to buy and sell guaranteed insurance contracts.

But the money wasn't invested in such contracts. Instead, the Vaessens used it to pay early ICC 2000 investors -- the hallmark of a Ponzi scheme -- as well as sales commissions and for the couple's personal expenses.

The Vaessens used investor funds to make mortgage payments on their Las Vegas home, to finance more than $50,000 of remodeling on the house, and to buy jewelry and clothes, the court said.