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Bronx Man Accused Of Running $35 Million Ponzi Scheme

NEW YORK (CBSNewYork) – They needed the money for their retirement, and now it's all gone.

Hundreds of Bronx residents say they're the victims of a multi-million dollar Ponzi scheme run by the man they trusted to prepare their taxes, CBS 2's Don Dahler reported Tuesday.

"That was our life savings for our retirement!" Lorraine Marchione said.

Lorraine and Tony Marchione said they are afraid of their financial future.

"To find out that everything was gone, it was devastating," Tony Marchione said.

Joe Morillo lost $60,000.

"I think I was robbed," Morillo said. "I said the only thing I have is an IRA, and he said, oh no, don't worry about it. We take IRAs."

"He" is Robert Van Zandt, whom New York Attorney General Eric Schneiderman said ran a $35 million Ponzi scheme, bilking more than 250 blue collar investors out of their retirement savings.

Starting in 2007, Van Zandt allegedly talked his tax clients into investing in his many real estate projects, including the Bridgeview Estates condominiums in Throggs Neck. The investors were guaranteed at least 9 percent interest in return for a share of the principal, but two years ago the truth became clear. All the properties were mortgaged to the hilt, and their investments were worth nothing.

"I was destroyed," Lorraine Marchione said.

Responding to the many complaints, the attorney general launched an investigation into Van Zandt's businesses, and 50 victims are bringing suit against the agency Van Zandt was licensed with, MetLife Securities.

"Many of our clients went from being retired to now working four jobs," attorney Jenice Malecki said.

Now, here's where things start to get interesting. About the time the state attorney general was looking into Van Zandt, his son was found floating in his backyard pool in Yonkers with a bullet in his head. Robert Jr. was an ex-con, with alleged ties to the mob.

Police said it was suicide, but his widow insisted it wasn't.

"He has been caught up in a tragedy of Shakespearian proportions," attorney Michael Bachner said.

Bachner said it was Robert Jr. who ran the Ponzi scheme behind his father's back.

"Mr. Van Zandt lost significant amounts of money himself," Bachner said.

The Van Zandt's Throggs Neck residence is modest to say the least, but his alleged victims said he bragged about vacation homes, priceless paintings and whirlwind trips to Las Vegas, gambling, they now believe, with their money.

Robert Van Zandt is facing 35 counts of fraud, money laundering and grand larceny. He could receive up to 25 years in prison if found guilty.

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