Company Linked to Ticketing Ponzi Scheme Files for Bankruptcy
By Peg Brickley
Company Linked to Ticketing Ponzi Scheme Files for Bankruptcy
National Events Holdings said it would sell the tickets it has to pay down the tens of millions of dollars in debt it is carrying.
The event ticketing business led by Jason Nissen, a former New York math teacher arrested and charged recently for running a $70 million Ponzi scheme, has filed for bankruptcy protection.
The event ticketing business led by Jason Nissen, a former New York math teacher arrested and charged recently for running a $70 million Ponzi scheme, has filed for bankruptcy protection.
Mr. Nissen allegedly bilked investors out of money on the pretext he was buying and reselling wholesale premium and VIP access tickets for major sporting events such as the Super Bowl and World Cup, as well as hit Broadway shows.
Instead, he spent the money on himself, or paid off earlier victims to keep the fraud rolling, according to federal prosecutors, who arrested and charged him on May 31.
“At the time that formal accusation is brought, it’s Jason’s intention to plead not guilty to the charges,” Mr. Nissen’s lawyer, Michael Bachner, said Tuesday.
According to papers filed Monday in New York bankruptcy court, the company he led, National Events Holdings, said it fired Mr. Nissen as chief executive “on or about May 10,” when it first learned of the fraud. Mr. Nissen allegedly presented victims with phony financial records to convince them he was using their money to fund wholesale ticket buys.
Days earlier, Mr. Nissen had admitted the fraud to two victims. According to federal prosecutors, when asked by an executive of one victim how he had fabricated a bank document, Mr. Nissen replied, “Photoshop. Ever hear of it?”
National Events Holdings did in fact buy some tickets, and will be selling what is left to try to pay down the tens of millions of dollars in debt it is carrying, court papers say. There is “a substantial bloc of tickets” for the 2017 U.S. Open, that the company believes it can resell for a profit, according to an affidavit signed by Timothy Puopolo, an outside turnaround executive who is handling the corporate cleanup.
Falcon Strategic Partners IV, LP, which owns a minority stake in the company, is owed $40 million, court papers say.
The case, No. 17-11556, has been assigned to Judge James Garrity in the U.S. Bankruptcy Court for the Southern District of New York. Herrick Feinstein LLP is representing the company.
