The Carr Miller Ponzi scheme is allegedly no different than countless other Ponzi schemes. Investigators allege that money from later investors was used to pay out earlier investors. In the case of Carr Miller, there were reportedly some legitimate investments, but it was mainly new investors' money that paid out the previous investors. Eventually, money from new investors reportedly dried up and there was no longer enough to pay out investors.
Court documents allege investors lost up to $40 million in Carr Miller. Of that, approximately $13 million went to personal purchases for Everett Charles Ford Miller, Brian P. Carr and Ryan J. Carr—the defendants in a lawsuit. Those purchases reportedly include a New Jersey Devils sky box, luxury vacations and vehicles. Furthermore, $16 million reportedly went to real estate ventures and film production companies that investors did not authorize.
Investors may be able to regain some of the lost money, either directly through Carr Miller Capital or through stockbrokers and investment advisors who may have referred customers to Carr Miller without their firms' approval. This is similar to the Bernard Madoff situation, where lawsuits were also filed against feeder funds that channeled money into Madoff's Ponzi scheme.
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Investors in Carr Miller Capital were reportedly promised returns of between 10 and 15 percent for nine-month terms. Approximately $8 million was allegedly paid out to investors, but was obtained not through legitimate investments but from money that came in from new investors. Following an investigation, New Jersey securities regulators and the New Jersey attorney general filed a lawsuit against Carr Miller Capital LLC and Carr Miller's principals.