Inside the FBI Podcast: Oasis Ponzi Scheme
On this episode of Inside the FBI, we discuss how the Bureau and our partners took down an $80 million Ponzi scheme.
Michael DaCorta: The one thing that we really care about is making sure that we deliver what we say and that everyone that does business with us walks away better than they started.
Thank you to everyone here who actually is a part of this business in any way, shape, or form. Obviously, it’s you that make us ... give us the fuel to do the work that we do. We’re so appreciative of every ... all the trust that you have in us, and we hope that you just have a great time tonight.
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Ellen Ferrante: That was Michael DaCorta of Sarasota, Florida. He was the former chief executive of an investment company called Oasis International Group.
It was December 2018. DaCorta threw a large, lavish Christmas party and invited current and potential company investors. No expense was spared. People dressed to the nines and enjoyed dinner, drinks, and a live band at one of the fanciest hotels around. On the surface, Oasis appeared to be doing great.
But that was the problem. Behind the façade of the holiday party, there was a scam that would hurt more than 700 people, with losses exceeding $80 million. DaCorta was running a FOREX—or foreign exchange market—Ponzi scheme, engaging in fraud and money laundering and manipulating people who thought he was their friend.
In this episode of Inside the FBI, we’ll learn more about this Ponzi scheme, how investigators took it down, how it affected victims, the warning signs of financial fraud, and what to do if you or someone you know may be getting scammed.
I’m Ellen Ferrante, and this is Inside the FBI.
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Ferrante: A Ponzi scheme is a type of investment fraud, named after Charles Ponzi of Boston. In 1920, he raked in an estimated $15 million in eight months by persuading tens of thousands of Bostonians that he had unlocked the secret to easy wealth.
How does a Ponzi scheme work? In sum, a scammer promises investors artificially high rates of return with little or no risk. But there is little or no actual business activity that produces revenue. To pay the existing investors, the scammer convinces new people to invest. The scammer pays existing investors with funds collected from new investors, keeping a chunk of money for themselves.
In a FOREX Ponzi scheme, the substance of the investment is supposed to go into a foreign currency market. This was the basis of the scam DaCorta and his co-conspirators created through Oasis.
From an onlooker’s perspective, DaCorta had it all. Big mansions. Luxury cars. Lots of friends. And a golden personality with plenty of charm.
Patti Katter and her husband met DaCorta through a mutual friend in their Florida community.
Patti Katter: My husband and I actually ended up relocating to Florida after he retired from the military, and we decided this is a great community to retire in. We were meeting a lot of amazing friends who just kind of took us under their wings and really made us feel like this was home.
So, we met Mike DaCorta through a mutual friend of my husband and I, and we kept hearing about this great opportunity to invest money for basically a quick return of interest. So, with our situation, my husband had been wounded when he was in the military, and we had some money sitting in savings for quite a while. We weren't really quite sure what to do with it because the banks, they weren't giving much interest, and we thought about investing in real estate.
But when we came across Mike DaCorta, we thought we wanted a little more information about his opportunities that he was offering people in the area who were his friends. And it sounded like a really exclusive, amazing opportunity. So, we talked with Mike, and he really encouraged us to invest in his company, Oasis.
Ferrante: DaCorta’s scheme heavily relied on establishing a false sense of trust with his victims.
Rick is an FBI special agent out of the Sarasota, Florida, resident agency who worked on the Oasis Ponzi scheme case.
Rick: So, Michael DaCorta used several ways in which he defrauded people and gained their trust. One of the biggest things was it was pitched as a family- and friends-only type thing. So, the people that were victimized got other close friends and family relatives to also invest.
And so, by doing that, there was a sense of trust that my, you know, brother or coworker or father or family members had already invested in, so therefore, I'm going to trust them a little bit more in that it's a closely held thing. So, there's some familiarity and security, or sense of security, from that.
Ferrante: DaCorta also embedded himself in the community, showing up to local events, working out with community members, and playing pickleball. His kids were friends with other kids in the neighborhood. And there were his extravagant holiday parties where he invited current and future Oasis investors.
Katter: He kind of smoothed his way into a relationship with us as far as the business side of things by inviting us to a really nice Christmas party. And then shortly after that, we had decided to invest.
Ferrante: If DaCorta can make himself look like a trustworthy guy, then it would be easier to get potential investors to buy into the so-called deal he was selling. The deal sounded promising. High interest where you can make at least 12% or more. A risk-free opportunity where your money would be safe. On paper, the numbers looked great. People started investing their nest eggs, such as their life savings, retirement funds, inheritances, or their kids’ college tuition, thinking it would all grow. They didn’t know yet that, little by little, their money was disappearing.
Rick: People would invest smaller amounts of money at first to test the waters and see if this was real or not. So, they might put in $50,000 or $10,000, and after several months, they would take a portion of the money out, or all of the money out, and they would receive some interest payments.
And so, even though this was just taken from other investor money ... for the victim, it gave a sense of security that, “Hey, I put in $10,000. I was able to take it back anytime I want. So now I'm going to move forward with my 401(k) or my retirement or, you know, whatever it might be, and invest $100,000 or $200,000,” because they had that sense of, “This must be legit because I received some interest payments already.”
Ferrante: Patti shares her experience of how she and her family started investing with DaCorta.
Katter: When we first were talking to Mike about his investment opportunities, he pretty much swung it any which way we wanted it to be. So, he was flipping currencies across the world, basically. And we were a little bit sold on the idea, so we were just going to put a little bit of money into it.
But then he's like, “Oh, if you at least invest six figures, then you’re going to have a bigger opportunity and you can become part of this great company, Oasis.” Because supposedly, he had two arms of his company, and if you invest a lot more, then you are going to have bigger interest returns. And I was still a little bit nervous with that. So, then he kind of worded it where, “Look at it as you're giving me a loan, and I'm going to pay you back a lot of interest.”
So that's what happened. We had signed paperwork, as he did as well, saying it was a loan and, basically, he was going to pay us back with a lot of interest.
Ferrante: And yet, there was just something about Oasis that felt off to Patti. She even called her accountant to ensure things looked okay. The accountant assured her that everything was fine.
Katter: But I started feeling really weird because, I just, I ... I don't know, I just can't even describe it. Just my gut was saying there was something wrong.
Ferrante: Patti’s instincts were right. Behind the scenes, Oasis was triggering red flags. In September 2018, the Commodity Futures Trading Commission reported concerns about Oasis. They started an investigation and realized it was shaping up to be a Ponzi scheme. So they contacted the FBI and IRS to further investigate. They meticulously followed the money to learn more.
Shawn is a special agent who is part of the IRS Criminal Investigation group out of Sarasota, Florida. He worked on the Oasis Ponzi scheme case along with Rick. Shawn explains:
Shawn: So, in a case like this, where it’s a, you know, a $70, $80 million scheme with 700-plus victims, the bank records are very voluminous. So, we had to kind of wrap our heads around who were the investors, who were making the deposits, and then kind of trace that money through accounts to prove that the operators of the scheme are the ones benefiting from it. They took a lot of the money for themselves, and portions of the money was actually traded in the FOREX market.
So, we had to kind of do an analysis on the trading activity of the FOREX market, which revealed that Mr. DaCorta was actually suffering catastrophic losses, which was exactly opposite of what he was telling investors on a week-to-week basis or even on conference calls.
Ferrante: The investigation revealed more about DaCorta’s past. He had been a stockbroker on Wall Street, which he used to pitch the legitimacy of his investments.
Shawn: He had a settlement with the NFA, the National Futures Association, where he would not solicit funds from any U.S. citizens for the purpose of FOREX investments. And because that settlement wasn't public, the investors could not find that anywhere to actually ... if they tried to do a search for him. But he obviously didn’t disclose that to any of the investors that invested into Oasis.
So, he had already been, I guess you would say, disciplined by a regulation body for some actions that he had taken in a previous investment opportunity and agreed not to solicit any further FOREX trading on behalf of U.S. citizens.
Ferrante: To learn more about DaCorta and Oasis, the FBI and IRS deployed an undercover agent who posed as an investor. The agent collected critical information, as well as audio and video footage.
Here’s what law enforcement figured out. DaCorta was falsely showing investors that Oasis was reaping enormous profits on foreign currency trades.
But in reality, Oasis had no true revenue. The earnings were being paid on each trade by Oasis back to Oasis to create the illusion of making money. All part of the Ponzi scheme. DaCorta sent investors fictitious account statements and created an online portal that showed fictitious profits to conceal enormous trading losses.
And any remaining funds? Well, those went to DaCorta to fund his lavish lifestyle.
Ferrante: The growing evidence finally caught up to DaCorta. He was arrested in December 2019. In 2022, a federal jury found him guilty of conspiracy to commit wire fraud and mail fraud, money laundering, and filing a false income tax return. He was sentenced in October 2022 to 23 years in federal prison. As part of his sentence, the court also entered an order of forfeiture in the amount of $2.8 million.
Evidence showed that DaCorta used victims’ funds to purchase a Maserati and Range Rovers, a country club membership, multiple million-dollar homes in Florida, college tuition for family members, flights on private jets, and trips to Europe and the Cayman Islands. Although DaCorta went to prison, victims of his Ponzi scheme would feel the long-term impact.
Rick: The victims suffered immensely. For some of the people, it was extra money that they invested and maybe they lost it, maybe it put them back a little bit. But for many people, it was catastrophic. There were people that invested their entire retirement. They were banking on it. There were people who got their friends and families involved and suffered a lot of not only financial loss but problems in marriages, in relationships … feeling very guilty for getting their family members to invest.
Ferrante: Patti and her family lost $100,000 as a result of DaCorta’s greed and deception.
Katter: It is frustrating because I could have definitely given that money to go towards our kids’ colleges or something like that, whereas our kids, instead, they paid their own college. And, at the same time, that's made them stronger and better. But there’s things that have come up that have been difficult. My husband is a disabled veteran, and he is unable to work. I feel like there's a big burden on my shoulders because I feel like, the common-sense part of things, I should have been more sensitive to what was invested.
Ferrante: The feeling of being betrayed by those whom you think you can trust also takes a toll on victims. And ultimately, the financial damage affects the entire family.
Katter: With him embedding himself in our friend group to intentionally target who we thought was our friend, you know, that takes it to a whole 'nother level. It's not just some pick pocketer. It's somebody who literally tries to befriend you and tries to get inside of your head to figure out how to get money out of you.
People can be vindictive. They’ve hurt me before or my husband in different ways but never gone out of their way to actually hurt our children, too.
So, I think that is something that’s often overlooked in crimes. So not only did Mike do something that hurt me or my husband but also our family and future generations, too, because we could have used that to help build some real interest for our kids to leave behind somedays.
Ferrante: Criminals are often deceptive and manipulative, so it’s not always obvious when someone may be taking advantage of you. But there are some red flags to look out for and general best practices when it comes to investing. The first is to trust your gut if something doesn’t feel right. The second, if an offer seems too good to be true, it probably is.
Rick: There are a lot of people that did not trust their gut that was telling them, “Hey, this might not be legitimate.” Because the returns were very enticing, and they were able to go online and look to see their account seemingly grow. And so, I think, if it feels too good to be true, take a second look. And also, just, if it’s not sitting right, trust that. And it’s difficult to necessarily see that when looking into some of these schemes.
Typically, what we've seen is a lot of the masterminds of these types of schemes are very sociable people. They’re very charismatic. They can definitely talk to people and gain trust, so they’re very skilled in manipulating people and getting them to trust ‘em.
Katter: You know, I was so excited going into it because here I thought it’s a friend. So first of all, I probably should have questioned the friend a lot more because it was a lot of money. But I trusted that friend. So, I would say anything to do with money and investment, you have to look at it as a business standpoint. You can't look at it as a friend standpoint.
Ferrante: In addition, if you’re investing with someone, do some research on their background.
Shawn: One thing I’d like to tell people, too, is to try to search just some public court filings in whatever area that this person’s operating in. And, you know, has this person filed for bankruptcy in the past? Are there lawsuits against this person? And, you know, when you just search somebody’s name, you're not gonna be able to find those things. If somebody's operating out of Sarasota County, you could go to the Sarasota County Clerk of Court and search their name for lawsuits, judgments, tax liens, that sort of thing. And that may also give you a good indication of a little better research on the financial aspects.
Ferrante: If you or someone you know is aware of a Ponzi scheme, or if you’re investing in something that doesn’t seem quite right, it’s important to contact the authorities. Reporting crimes can help keep you safe, as well as protect others.
To report a crime, visit the FBI Internet Crime Complaint Center or ic3.gov. That’s the letters I and C and the number three. You can also contact a local FBI field office.
Shawn: We’ve seen oftentimes when somebody’s been victimized, I think one of the first things they think of is maybe filing a police report. And sometimes, it never gets to us, whether it be FBI, IRS, or U.S. Attorney’s Office. So, you know, for investment schemes and things like this, I think it’s important to make sure that you do report it to the FBI or another federal agency.
Rick: One of the things about these kind of situations are, a lot of times, they can be underreported, where victims feel a lot of embarrassment or shame associated with it. They don’t want to let their spouse know that they lost a considerable amount of money ... or their family know. And a lot of times, we only become aware of these schemes when they fall apart. And so, it can be difficult to kind of know what’s out there ahead of time unless we’re tipped off by an investor or someone who has some knowledge of what's going on.
Ferrante: Today, Patti and her family are getting by financially and working to move forward despite the money they lost. She offers advice for other victims who may have had a similar experience.
Katter: You know, you really can’t go back and fix the mistake, right? You can only move forward. I have a business, so I'm trying to make it better and stronger and invest in myself instead of investing in anybody else right now. So, it’s hard, but you just can't beat yourself up about it. You know, when somebody commits a crime to you, your first instinct is to think, like, “Oh my gosh.” Don't think “poor me” because that kinda lets them win, too, in the end, right?
So, I look at it as Mike was trying to hurt our family, and it did to an extent. But you have to brush yourself off, and you have to not let him hurt you anymore. You just have to move on.
Ferrante: And DaCorta? Well, he never apologized for his crimes. Or even acknowledged them. Behind the friendly façade was a cold-hearted fraudster ruled by greed and indifference.
Rick: The victims of this are real people who oftentimes don't have the extra money to invest, to lose, and that they're banking, you know, their kids’ futures, their retirement. People that have to go back to work when they should be enjoying their retirement years.
And, you know, these are real people who ... their life has forever changed by what Michael DaCorta did to them.
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Ferrante: This has been another production of Inside the FBI. You can follow us on your favorite podcast player, including Spotify, Apple Podcasts, or Google Podcasts. You can also subscribe to email alerts about new episodes at fbi.gov/podcasts.
I’m Ellen Ferrante from the FBI’s Office of Public Affairs. Thanks for tuning in.
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