Yet another Ponzi schemer has made headlines on his way to federal incarceration. Algird M. Norkus, a 67-year-old man from Aurora, Illinois, was recently convicted by the Northern District of Illinois in Rockford to a 63-month term of imprisonment after pleading guilty to a Ponzi scheme in which he stole over $9 million from his victims.
Norkus operated a company called Financial Update, Inc., headquartered in Oak Brook, Illinois. He operated this company for 23 years without problems, operating in the insurance business. In addition, Norkus solicited investors for his business, in exchange for an investment he would provide the investor with a promissory note promising returns ranging from 11% to as high as 24%.
However, rather than using these funds to operate his business, he used incoming funds to pay off prior investors while at the same time diverting funds for his own personal use, such as the purchase of a car and the payment of his mortgage. It was not until 2010, when a handful of unhappy investors confronted Norkus about missed payments, that his Ponzi scheme became unraveled.
In total, Norkus issued over $9 million in promissory notes, and as part of his sentence he was ordered to pay $4.6 million in restitution to 52 different victims. The Securities and Exchange Commission is also currently pursuing a civil action against Norkus arising out of this same scheme. (Case No. 10-cv-06582 – N.D. Ill.)