As a business ethics keynote speaker, business ethics consultant and book author, I am constantly amazed (but no longer surprised) by the creativity of fraudsters. If these guys paid half as much attention to running their legitimate businesses as they did to running a scam, they might actually do well.
However, fraudsters such as Sanjay Singh of Coral Springs, Florida always convince themselves they know better. They are, unfortunately, also good at convincing the unsuspecting and greedy that they know all of the answers.
The scheme
The “Ponzi Scheme” Mr. Singh created was based on lies about his business. By the way, I have never met a good fraudster who wasn’t an outstanding liar. Why are they so good at it? Because they must spend years lying and rationalizing to themselves.
Singh, was the founder, CEO and president of Royal Bengal Logistics, Inc. (“RBL”), a trucking company. From 2019 to the start of 2023, this owner of the trucking company stopped trying to transport and slowly turned his attention to theft.
According to the SEC, RBL “Offered and sold investors high-yield investment programs that purportedly generated 12.5% percent to 325% in guaranteed returns.”
Let’s stop for a second. As a business ethics keynote speaker, business ethics consultant and book author, I have heard a lot of outrageous claims vis-à-vis fraudulent returns on investments, but even Bernie Madoff might have blushed at the claim of three-hundred percent return.
To back these outrageous boasts and lend them an air of legitimacy, RBL and Founder Singh said they would use the money to buy and enhance the existing fleet of trucks. In order to make the claims seem solid, RBL had to fake their numbers. RBL claimed it was pulling in revenues of about $1 million per month, and that it was profitable.
In truth, RBL was never profitable. They operated with deepening losses. Nevertheless, they had enough in the way of shiny trucks and committed co-conspirators to make the scam seem convincing enough. What they needed was a “mark,” i.e., naïve individuals who knew enough to want better for themselves, but not sophisticated enough to ask questions.
The implementation
Sanjay Singh convinced his wife that it was a can’t miss scheme providing they could rope-in naïve investors. They turned to a like-minded individual who had extensive ties to the Haitian community.
Dare I say? I must. Singh’s targeting of the Haitians was – at best – racist and more broadly, intentionally played into the aspirations of all immigrants: to create a better life. Using a network to approach the Haitian community, Singh took in approximately $112 million from more than 1,500 investors. In some cases, no doubt, the investments represented all of their savings. Of the money that came pouring in, Singh and his wife skimmed at least $14 million off the top. The SEC stated:
“The funds were allegedly used to renovate Singh’s residence, make mortgage payments, cover personal expenses, and engage in margin trading of stocks.”
In regard to that last point, to make the scheme seem legitimate, Singh started to play the options market and went after high-risk (presumably) high-yield investments. For that purpose, he stole about $20 million of investment money. In that way, he could generate returns for his first-in investors who could then lure-in more investment.
As with any other Ponzi-type scheme failure, the stock market being unpredictable, cannot guarantee returns or sure-fire stock trades. The SEC figures that this “genius” lost more than $1 million in terms of lousy stock trades. When complaints started coming into law enforcement, the RBL scandal and Singh himself, were revealed.
He has been charged with “conspiracy to commit wire fraud, wire fraud, and engaging in transactions involving unlawful proceeds,” in addition to pocketing unknown millions for himself.
Do unethical scams of this nature work? Singh thought they did and instead he is looking at 150-years in prison. There is no mention in the news of this case if one truck or trailer was ever purchased; if one more load was transported; if at any time, anyone close to him said, “Why not build a legitimate trucking business?”
Scam artists don’t think that way. They don’t care about the pain they inflict until well after the fact. He and his co-conspirators will have many years to think about this.
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