Texas Man Convicted Of Bankruptcy Abuse

: Chris Lee Law Firm

  Filed under: Bankruptcy

bankruptcy fraudTimes are tough and the measures some people will take to make money can be extravagant. A Texas man was sentenced this week, convicted of running a nationwide Ponzi scheme and abusing the Texas bankruptcy system.

Facing Hard Time

David Maloy lived a luxurious lifestyle for many years as he quietly ran a scam behind closed doors. Operating a phony cash rebate business, Maloy was able to scam millions of dollars under his business Cash Rewards Inc. (CRI). CRI claimed to make use of  a marketing tool that could attract prospective customers to retail businesses with a time-deferred, mail in cash reward certificate. CRI sold their “services” to numerous companies nationwide and acquired over $7 million in income.

Not only was CRI operating a national Ponzi scheme, whereby Maloy raked in enough to purchase fancy cars and boats, but he abused the system when the company filed for bankruptcy in 2009. Directly disobeying court orders, CRI continued to operate and scam funds off unsuspecting victims around the country.  David Maloy was convicted earlier this week of stealing more than $7 million from over 700 businesses and 600 consumers nationwide. He will be serving 120 months in prison, followed by three years of supervised release. He is also ordered to pay over $7 million in restitution for his crimes.

 


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