News: 2009 Press Release
For Release: November 16, 2009
Media Calls Only: 916-492-3566
Insurance Commissioner Poizner Announces Arrest of Sacramento Man on 100 Felony Grand Theft, Burglary Charges in Ponzi Scheme
California Insurance Commissioner Steve Poizner today announced that William A. Sassman, 41, of Sacramento was arrested early Nov. 16 on 43 felony counts of grand theft, 40 felony counts of selling unauthorized securities, 16 felony burglary counts and one count of using a device, artifice or scheme to defraud. Sassman was booked into the Sacramento County Main Jail and bail was set at $3.2 million. He faces 20 years in prison if convicted on all 100 counts.
"When we receive complaints scammers are targeting seniors, we take swift action to put a stop to it," said Commissioner Poizner. "Preying on our senior citizens is especially disgusting and those who do will be investigated, caught and prosecuted to the fullest extent of the law."
A joint California Department of Insurance (CDI) and California Department of Justice (DOJ) investigation revealed that more than half of the 35 known victims were senior citizens. The total loss of Sassman's alleged five-year Ponzi scheme is estimated to be $6.3 million. The investigation continues to examine Sassman's business practices and CDI investigators are asking for anyone who may have done business with Sassman to contact CDI at (800) 927-4357.
In Feb. 2006, the Department of Corporations issued a "desist and refrain" order to stop Sassman from selling unauthorized securities under various company names. Sassman's alleged scheme involved the use of various company names, including Formulating Insurance Agency LLC, Formulating Investments, InTex LLC, and Systematic Management Services LLC. Through alleged misrepresentation and deceit, Sassman convinced clients to invest funds into various joint ventures that ultimately failed.
A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors, rather than from any actual profit earned. Ponzi schemes require an ever-increasing flow of money from investors to keep the scheme going. In Sassman's case, most of the money taken in had allegedly been used to support a lavish lifestyle, and investors have been kept at bay by getting small payments of money taken from new investors.
Sassman has been a licensed life insurance agent since 1992. A bail hearing will be scheduled and Sassman will have to prove to the court the source of any funds used toward bail.
Please visit the Department of Insurance Web site at www.insurance.ca.gov. Non media inquiries should be directed to the Consumer Hotline at 800.927.HELP. Callers from out of state, please dial 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.
If you are a member of the public wishing information, please visit our Consumer Services.