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Friday
Mar202009

Ed Okun Convicted of Defrauding 1031 Exchange Clients

Ed Okun acquired a number of 1031 exchange companies and the proceeded to use the 1031 exchange Qualified Intermediary operations as his personal piggy bank to fund his expensive lifestyle, acquire toys, travel and purchase commercial real estate investments.

Cheapest Money He Ever Bought

You may not remember this, but Ed was quoted as saying that the 1031 exchange companies that he purchased was the 'cheapest money that he had ever bought.'  I wonder if he still feels the same way about his actions today? 

Jury Convicts Okun

The Jury convicted Ed Okun on March 19, 2009 in the $126 million fraud.  Ed Okun was convicted on all 23 counts and faces up to 400 years in prison when sentenced in August of this year.  Ed Okun's sentencing hearing begins on August 4th.

Ed Okun, 58 years old, of Miami, Florida was indicted last summer on 27 counts of conspiracy, wire and mail fraud, money laundering, currency smuggling and making false statements.  Four of the charges were either withdrawn or dismissed before being considered by the jury.

Robert Wagner, one of Ed Okun's attorneys, said they intended to appeal the verdicts.

Six 1031 Exchange Companies

Testimony in the trial showed that Ed Okun acquired six (6) 1031 tax deferred exchange companies that held clients' 1031 exchange funds from the sale of real and personal property in order to defer their capital gain and depreciation recapture taxes. 

He started buying the exchange companies in August 2005, and then began raiding the client accounts, in part, to buy more 1031 tax deferred exchange companies to keep the ponzi scheme running as well as personal reasons.

An IRS agent testified that from August 2005 to March 2007 Okun spent $35 million on a divorce settlement, jewelry and boats -- including a 131-foot yacht named Simone after his current wife, whom he married in a $171,000 ceremony in December 2005.

Ed Okun did not testify during the trial and his defense team offered no evidence at trial. His lawyers argued that Ed Okun viewed taking the client money as loans to him and/or his companies that he always intended to repay.  They said Okun believed he could use the 1031 tax deferred exchange funds for any purpose as long as the clients' 1031 tax deferred exchange funds were available to them when needed to acquire replacement property for their 1031 exchange transactions.

The evidence indicated that Ed Okun and others had misappropriated about $126 million in client 1031 tax deferred exchange funds.  The figure had earlier been listed as $132 million.  Three of Ed Okun's co-defendants plead guilty earlier last year and were sentenced last May.  The Department of Justice said the continuing investigation is being conducted by the U.S. Postal Inspection Service, Internal Revenue Service and the FBI.

Reader Comments (5)

Dear Sir or Madam,

As far as I know none of the co-defendants were yet sentenced.

Your Article claims they were sentencded last May.

Could you be mistaken?

Ellis Simring
April 12, 2009 | Unregistered CommenterELLIS SIMRING
Hi Ellis,

The information that I had indicated they had been sentanced. I will check into this when I have time to see if the data is accurate. Thank you for your comments.
April 12, 2009 | Unregistered CommenterWilliam L. Exeter
DEAR WILLIAM

ACTUALLY I BELIEVE THAT THE SENTENCING WILL BE AFTER OKUN'S IN AUGUST 2009.

WITH REFERENCE TO RICHARD SIMRING I RESPECTFULLY REQUEST THAT YOU READ THE FOX REPORT: THE RISE ND FALL OF RICHARD SIMRING ... ON THE INTERNET.

MANY COMMENTS ON THE REPORT ARE MINE .... THE INTRODUCTION WAS WRITTEN BY THE FOX TEAM.

ALSO GOOGLE RICHARD TO LEARN WHO HE IS AND WHAT HE STANDS FOR.

MY POSITION IS THAT MY SON RICHARD SIMRING WAS LABORING UNDER A SEVERE MENTAL DIMINISHED CAPACITY FOR THE PAST 6-8 YEARS AND IS GUILTY OF NO CRIME.

IF YOU WOULD LIKE TO DISCUSS THIS FURTHER I AN BE REACHED AT 954-918-8123 OR ellissimring@yahoo.com

RICHARD'S PROBLEMS WERE CAUSED BY IS WIFE ... AN ADDICT ... IN AND OUT OF REHAB MANY TIMES ... AND AS I WRITE THIS SHE IS HOSPITALIZED AGAIN AND ON A VENTLLATOR PROBABLY FROM AN OVERDOSE OF SOMETHING.

SHE WAS HOSPITALIZED LAST WEEK BECAUSE OF AN ACCIDENT AND WAS OPERATED ON HER SPINE. DURING THE PAST EIGHT YEARS SHE HAD MANY ACCIDENTS WHILE DRUNK.

WE NEED AN INVESTIGATIVE REPORTER TO LOOK INTO RICHARD'S PLEA WITH THE GOVERNMENT, HIS ENTERING THE PLEA AND THE REPRESENTATION HE RECEIVED.

ALTHOUGH JUDGE PAYNE WAS ON WRITTEN NOTICE OF RICHARD'S MENTAL CONDITION INSTEAD OF HAVING HIM EVALUATED BY A FORENSIC PSYCHOLOGIST THE JUDGE ACCEPTED THE PLEA.

THIS CASE IS TRUE REPRESENTTION OD PROSECUTORIAL ABUSE, JUDICIAL APATHY AND LEGAL MALPRACTICE.

JUST AS IMPORTANT RICHARD PLED TO A CONSPIRACY THAT ENDED AT LEAST SIX MONTHS BEFORE HE BECAME GENERAL COUNSEL TO OKUN'S FIRM.

HIS PLEA MUST BE VACATED BUT RICHARD WILL NOT COOPERATE AND BE EVALUATED .... IT IS A MESS RUINING RICHARD'S PAST EXEMPLARY LIFE AND AFFECTING HIS 6 YEAR OLD SON AND NINE MONTH OLD DAUGHTER.

ELLIS SIMRING

ELLIS SIMRING
April 14, 2009 | Unregistered CommenterELLIS SIMRING
As someone who lost a substantial amount of money to Okun's scheme to defraud I have little sympathy for Mr Simiring's plight. As close as he was to Okun's dealings I find it hard to believe he did not know what was going on...otherwise why would he take a plea. If he is truly innocent I hope he gets his day in court to priove it.

We have lost our money, retirement plans, and suffered much emotional distress over the past two years...through no fault of our own. We did not even know that Okun had purchased IXG as his "piggybank".

Who's the victim here? We just want those responsible to never hurt others again.

Mike
August 5, 2009 | Unregistered CommenterMike
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