A warning for expat retirees living in dream locales—mind your money in unfamiliar territories, cultures and financial markets. News of a decade-long Ponzi scheme has come to light involving community members of tight-knit San Miguel de Allende, an historic city in Mexico’s central highlands, and a well-regarded employee of Banco Monex.
The victims, many of them foreigners in retirement, have allegedly lost $40 million from 150 accounts, although a Banco Monex spokesman puts the figure at $8.2 million and 49 complaints, according to Mexico News Daily.
Victims dispute the Monex figure, claiming their losses alone come close to the total amount claimed by the bank.
“As the scope and scale of the fraud begins to unfold, retirees and elderly with little savings and less family support are settling for half or less of their lost funds in restitution, hoping to eke out a life with what little resources they have left,” the paper adds.
Marcela Zavala Taylor is the bank employee suspected of the theft. She is the daughter of former San Miguel mayor Manuel Zavala and Peggy Taylor, a Christies International Real Estate agent originally from Texas.
Victims large and small
Known for her social nature and sunny demeanor, Zavala allegedly used her connections to win clients and trust, one of whom was Howard Haynes, an 83-year-old philanthropist from Kansas City who has lived in San Miguel for 22 years.
The New daily notes, 10 of those years were served on the board of the Community Foundation of San Miguel. In 2010, he received Hospice San Miguel’s first community caregiver award for volunteering and financial support.
“With his Monex accounts established primarily for these charity donations and philanthropic scholarships, Hayne’s losses were among the largest of all the San Miguel fraud victims. His funds were drained to almost nothing and moved between accounts, without his approval, to and from people he’d never heard of.”
Haynes, and other victims, don’t believe Taylor acted alone, noting the scheme was too large to go undetected by at least some of her bank superiors, something with which Taylor’s mother agrees, telling Bloomberg Businessweek her daughter is taking the fall.
“Monex has a lot to do with this, too,” she said.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
