Accused Ponzi schemer held in contempt

U.S. District Judge David M. Lawson has found John J. Bravata, accused in an alleged $53 million “Billionaire Boys Club” Ponzi scheme, in contempt of court for violating an asset freeze in the case, reports The Detroit News.

And, Lawson ruled, Bravata will go to jail on Oct. 8 if he doesn’t repay the funds.

Lawson froze Bravata’s assets shortly after the Securities and Exchange Commission filed a civil fraud suit that accused Bravata and others of operating Ponzi-style investment scheme.

From The News:

But the SEC recently learned that Bravata borrowed about $37,000 from his life insurance policies at the same time he was asking permission from Lawson to take out the loan. Lawson denied the request and Bravata’s request for him to reconsider his denial, all without being told Bravata had already taken out the loan. …

[Bravata] said he took out the loans due to “necessity” and because he believed the life insurance policies were not covered by the asset freeze … .

But when pressed by Lawson, Bravata agreed there was nothing in Lawson’s asset freeze order to lead him to believe he could borrow against his life insurance policies.

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