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Checks Being Sent to Boat Owner Who Found Dzhokhar Tsarnaev

ABC News — Mon, 22 Apr 2013 12:55:00 EST

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By CHRISTINA NG

America wants to help David Henneberry get a new boat.

The Watertown, Mass., resident became a hero when he discovered suspected Boston Marathon bomber Dzhokhar Tsarnaev hiding in his backyard boat.

Henneberry quickly called the cops and in a final standoff, his boat was riddled with bullet holes.

"That boat's his baby. He takes care of it like you wouldn't believe. And they told him it's all shot up," Henneberry's friend and neighbor George Pizzuto told ABC News. "He's going to be heartbroken."

Today, people around the country want to make help mend that broken heart.

Deborah Newberry, 62, of Orlando, Fla., has already put a $25 check in the mail to Henneberry's home.

"Something told him to go and check things," Newberry told ABCNews.com. "I just want him to know that people care about him because I know he's probably the guy that would say, 'Well, that's okay.' But I just would like him to know that we're all thinking about him and appreciate his spirit."

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She believes Henneberry had to be "awfully, awfully cool" to emerge from a daylong lockdown, notice something wrong with his boat, find a bloody man in it and slip away to call police.

"Just listening to his coolness and how he handled the situation, it was like okay, that is a man who needs to have his boat restored," Newberry said.

When asked if she sent Henneberry any note with the check Newberry said no, she simply wrote, "towards a new boat" on the check.

"He don't know me from Joe Turkey," she said with a laugh. "I want him to go back to his regular little things that he do and don't have to worry about having a boat."

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Florida lawyer John Phillips felt the same way.

"[The boat] is fairly insignificant in the grand scheme of things, but that's what's significant to him," Phillips told ABCNews.com of the bullet-riddled boat. "If that's what the guy's passion is, I have no problem whatsoever chipping in and helping out."

Phillips, 38, is a personal injury attorney in Jacksonville, Fla. He wants to send Henneberry $1,000 for a new boat since he predicts the boat will be held as evidence for some time.

"He just had his boat shot up and had a terrorist live in it for a day," Phillips said. "If the dude wants an upgraded boat, let's get the guy a boat without terrorist blood in it."

Watertown Police Chief Edward Deveau has been inundated with messages of gratitude and praise as well as requests from people who want to know how they can get a Watertown Police T-shirt.

"I'm getting emails and things from all over the world," Deveau told ABC News. "I got an email this morning. Some person in Detroit, Michigan, who wants to replace the boat for the Watertown resident that got shot up. I mean, it's just incredible."

People on Twitter are echoing the calls to help Henneberry, hailing him a hero.

"Bravo, David Henneberry! You are a true American hero. I say we all pitch in and buy you a new boat. #welldeserved," one person tweeted.

Another wrote, "Some boat company needs to hook David Henneberry up with a new boat. His has a few holes in it. Holey #boats don't float."

Henneberry's boat is reportedly a 22-foot Seahawk cruiser with a fiberglass hull, which retails for around $50,000.

He did not return ABC News' request for a comment.

"It took more than the police department to get it done and that's the American spirit to me," Phillips said. "It's one random guy and one random boat ironically in a town named Watertown that's supposedly landlocked. Truth is stranger than fiction. You couldn't write this stuff and be believable."

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President Obama's Weirdest New Taxes

ABC News — Fri, 12 Apr 2013 13:45:00 EST

Filed under: Taxes

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By CHRIS GOOD

President Obama has plenty of big taxes in his budget proposal.

To achieve $1.8 trillion in new revenue, the president suggested a few of the policies he's raised while battling Republicans over the past four years: taxing higher incomes by capping itemized tax deductions, rolling back domestic-production credits for oil companies, instituting the "Buffett Rule" of a 30 percent minimum tax rate for people making over $1 million in a year, and taxing investment managers' "carried interest" profits as regular income top the list.

But the tax code is a jungle of odd rules, and the penny-pinching side of Obama's budget raises some new taxes (or closes some "loopholes") that might not readily occur to most taxpayers filling out run-of-the-mill 1040s this weekend.

As laid out this week by the Treasury Department in its "green book," a massive spiral-bound document that explains tax changes in the White House budget proposal - it is pale green, and 246 pages - here are some quirky maneuvers the president suggests to offset spending and keep the deficit just a bit lower:

Gallery: President Obama's Weirdest New Taxes

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Pokerstars' Bid to Buy Casino Could Signal Gambling Gold Rush

ABC News — Tue, 12 Mar 2013 15:25:00 EST

Filed under: FTC, Economy, People

The Atlantic Club Casino and Hotel is seen Thursday, Feb. 14, 2013, in Atlantic City. (Mel Evans, AP)

By COLLEEN CURRY

A move by the online gaming giant Pokerstars to buy an Atlantic City casino could signal a gold rush for the gambling industry, according to industry watchers.

Online companies are expected to be scrambling for land and casinos in states like Nevada, New Jersey, and Delaware, which recently passed laws allowing online gambling if it is affiliated with in-state casinos. Similar bills have also been introduced in Pennsylvania and Illinois.

Pokerstars, part of the online gambling corporation Rational Group, based in the U.K., struck a deal earlier this year to buy the Atlantic Club, an 800-room hotel and casino on the Atlantic City boardwalk, according to paperwork filed with the state's division of gaming enforcement.

The move came after New Jersey Gov. Chris Christie signed a law Feb. 26 allowing online gambling for residents as long as the games were hosted by in-state casinos located in Atlantic City.

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The company, which was previously indicted by the Department of Justice for offering online gambling to U.S. residents, wants to legally operate its website and the casino, according to its owners. They reportedly paid about $30 million for the casino.

"In a nutshell, the future of gaming will require a mix of online and offline expertise," Eric Hollreiser, spokesman for Pokerstars, told ABCNews.com in an email. "We are the world's largest online poker company and one of the largest producers of live poker tournaments in the world, which we produce in many of the world's best known casinos."

Hollreiser said that the proposed business model would help drive online gamers into casinos for live tournaments, and remind casino-goers to log on and game at home until their next visit.

"We drive traffic from our online tournaments to our major casino partners around the world. This drives a poker tourism business in cities such as London, Monte Carlo, Barcelona, (and) Rio," he said. "The traffic runs both ways as we introduce new audiences to poker in these live tournaments."

Precedent-Setting Decision

Pokerstars is awaiting approval from the Division of Gaming Enforcement and the state's Casino Control Commission. If it goes through, it could represent the first time a gaming website has transformed into owning and operating a hotel and casino.

The development could send waves through the gaming industry.

"The casino-going population is older. You have this huge bubble of younger people who have never gone to a casino or intend to go to one, but spend half their waking life on smartphones or computers, playing games, social networking. So how does the gaming industry respond?" said Joe Brennan, director of the Interactive Media Entertainment and Gaming Association (iMega), who has studied the effects of disruption on the gaming industry.

Because states are requiring online gamers to have a casino in the state, companies on both sides of the issue are rushing to take advantage of business opportunities. Casinos are partnering with online gamers or developing their own web games, while online poker giants are rushing to find real estate in states where casinos are legal, Brennan said.

"Pokerstars is indicative of this: that online giants aren't going to sit back and let U.S. (casino) companies eat their lunch. They built their industry and I don't think they're going to passively sit back and allow it to be acquired," Brennan said.

The American Gaming Association, the casino industry's main lobby, filed a brief opposing Pokerstars' application to buy and operate the New Jersey casino.

Federal Regulation Sought

Frank Fahrenkopf, president and CEO of AGA, declined to comment on the brief, but insisted that the AGA supported the future of online gaming and would like to see the industry federally regulated.

He insisted that legalization of online gambling won't cut into the profits of casinos.

"We did some studies a few years ago and looked at the question of whether or not online poker would cannibalize our brick and mortar businesses, and we came to the conclusion that it would probably not be a cannibalization but a new profit center," Fahrenkopf said. "A lot of the people online tend to be young men, with a higher education and a little higher income than the average player, and these people historically have not gone to casinos."

In the race to serve both online and in-person gaming audiences, the odds favor the online gaming operators, according to Brennan. The casinos are typically enormous hotels that have struggled, especially in Atlantic City, in past years as casinos have cropped up in neighboring states.

"A lot of these online gaming companies have cash on hand, whereas you look at the biggest and best of the brick and mortar companies and they're challenged. They're saddled with debt. They don't have a lot of cash on hand," Brennan said.

Industry Could Benefit

Still, as the companies adapt to the changing marketplace, both the brick-and-mortar shops and the web-based businesses could benefit, he said.

"Brick and mortar casinos are not just going to drop off the face of the earth. People are not playing at the same stakes online as they are in casinos. It's much smaller stakes," Brennan said. "The world leading poker companies, over 90 percent of users are playing at a penny or a dollar per hand. You can't sit down at table in Atlantic City or Las Vegas for those kind of table stakes. It seems like a fantastic opportunity to start grooming those players to take a visit to Atlantic City or Vegas."

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Widow Elsie Smith Sells Everything She Owns to Bury Late Husband

ABC News — Sat, 16 Feb 2013 20:26:00 EST

Filed under: Family Money, Personal Finance, Estate Planning, Funeral Costs

By Alexis Shaw

A 91-year-old Arlington, Wash., widow is selling all of her belongings so she can afford to bury her late husband.

Elsie Smith told ABCNews.com she is hoping that by selling all of her possessions through an estate sale, she can bury her husband in the same cemetery as their family members in Snohomish, Wash.

Smith said that someday, she wants to be buried there as well.

Smith had been married to her late husband, Joe Smith, for "46 and a half years," she said. The two met through her niece's husband, who was a co-worker of his at the time.

Joe Smith passed away at the age of 88 on Feb. 5. For the past two years, he had been suffering from Alzheimer's disease, ABC's Seattle affiliate KOMO reported.

"I loved that man more than anything in this whole wide world," she told KOMO.

Smith has a total of $9 to her name, KOMO reported. She said she thinks it will cost "about $3,000 for the funeral."

"I would like to get some help in any way that I possibly can," she said.

Everything is up for grabs in Smith's apartment when the sale takes place, except "her makeup and her clothes," she said. Smith said she will not be selling her husband's clothing either.

Smith said her late husband's niece is helping her with the estate sale, which she thinks will happen sometime next week.

"I'd like to keep everything," she said. "But I have to sell it."

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Scammers Hacking Victims' Computers by Calling on the Phone

ABC News — Tue, 05 Feb 2013 13:00:00 EST

Filed under: Identity Theft, Internet Fraud

Con artists are using old-fashioned technology to gain access to consumers' newfangled technology.

I pride myself on knowing all the latest scams, but I had never heard of this one, so I'm assuming you haven't either. Here's how it works: A crook calls you on the phone, poses as a technician from a big company like Microsoft (MSFT), and claims he's detected a virus on your computer. He (or she!) then asks for access to your computer in order to "help" you.

From there, the scheme can devolve into several different money-making ploys, according to the Federal Trade Commission. The con artist may:

Ask for remote access to your computer and then change your settings in a way that makes your computer -- or the information on it -- vulnerable.

Enroll you in an expensive -- but worthless -- computer security, maintenance or warranty program.

Trick you into installing malware that then snags your private information, like passwords or financial details.

Ask for your credit card information and steal it or use it to bill you for fake services or services that are readily available for free.

This is where my oldest and best advice comes into play. I always advise: "be the hunter, not the hunted." In other words, learn to be skeptical of any stranger who comes at you claiming urgency and demanding money.

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Instead, take the time to do your own search. Find a published help line number for your hardware or software manufacturer or Internet service provider and dial it yourself. Don't rely on any phone number or website the caller provides, as it may be a fake.

In fact, be careful where you look up the contact information you need. A large company's home page is a good place to start. An online ad is not so reliable, because the FTC says con artists have begun boldly placing ads containing false information in order to build an aura of realism around themselves.

Does this scheme sound sickeningly familiar because you've already fallen for it? If so:

Use legitimate security software to run a scan and see if there is malware or virus activity on your computer.

If you gave the caller any passwords, change them for the account in question and any other accounts for which you use the same passwords.

If the caller charged bogus services to your credit card, call the card company and insist that those charges be reversed.

If you think personal financial information may have been stolen, order your free credit reports at www.annualcreditreport.com, created by the Fair Credit Reporting Act, and check for suspicious activity.

If you verify that you are a victim of identity theft, the Federal Trade Commission has an entire website to guide you through fighting back, and you can find it here: www.ftc.gov/bcp/edu/microsites/idtheft2012/

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New Jersey Town Gives People Property Tax Break for Shopping

ABC News — Mon, 28 Jan 2013 12:50:00 EST

Filed under: Taxes, Shopping, Property Tax, Sales Tax

The township of Marlboro, N.J., is giving residents a break on their property taxes if they shop at local stores.

"Every local elected official has to do their part to help us get out of this recession and help local businesses," said Marlboro Mayor Jonathan Hornik. "We're doing our part, which we hope will increase the number of customers coming to these establishments."

Launched in Sept. 2012, the "Shop Marlboro!" campaign allows local businesses to offer shoppers a chance to have a percentage of their purchase go toward their property tax bill.

The town has issued 1,700 reward cards, in conjunction with a consumer financial company called FinCorp and a local bank, Investors Bank.

The 38 participating businesses can choose whatever percent discount they choose to shoppers with the reward cards. It will cut into stores' margins, but the store gains a customer, and the shopper saves at tax time. So far, the participating businesses have offered property tax credits from 2 to 16 percent off shopping bills.

"I have a card in my wallet, and say I have a $100 bill at a store," Hornik said. "With a 10 percent break, the retailer will make sure $10 of those dollars are a credit on my tax bill."

Residents can pick up a rewards card at the Marlboro Town Hall and the local Investors Bank.

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There have been 130,000 transactions under the program so far, saving shoppers $8,000 total on property taxes. The next tax bills in Marlboro are due in February.

Hornik said he believes this is the first program of its kind.

"I think it's a success and I think it will continue to be a success," said Hornik, adding that he has personally saved $254 on his property taxes by shopping locally. He said he hopes the program will continue to grow. "We have 41,000 residents. I would like to see the number grow from 1,700 participants," Hornik said.

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8 Things That Will Cost More in 2013

ABC News — Tue, 01 Jan 2013 07:00:00 EST

Filed under: Cost of Living

Happy New Year! Your life just got more expensive.

While congress frets over the looming fiscal cliff and taxpayers brace themselves for higher tax rates, consumers should prepare for certain goods to become pricier in 2013.

Groceries, fuel-efficient cars, and health care are all expected to get a little more costly next year, according toDealnews.

But, there might be an alternative for some purchases.

"The easiest way to dodge some of these rising costs is to buy used," Dan de Grandpre, CEO of Dealnews.com, told ABC News.

"A used car may not get as good mileage as a new one, but you'll never save enough money at the pump to offset the money you'll save buying used. Consider a used or refurbished iPhone 4 or 4S for the same reasons," said Grandpre. "Not only will you dodge the full price of a newer iPhone, but you'll be able to use older cables and speaker docks that are hitting their best prices in history as manufacturers move to Apple's newer Lightning connector."

Here's a look at a few of the items compiled by DealNews that will increase at the beginning of the year:

Gallery: 8 Things That Will Cost More in 2013

You can read the complete list of more expensive items here.

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Man Wins New Hampshire Lottery With Ticket Sold in Error

ABC News — Wed, 26 Dec 2012 10:48:00 EST

Filed under: Personal Finance

By Suzan Clarke

A New Hampshire man is the winner of a $2.1 million Megabucks lottery jackpot even though the lucky ticket wasn't the one he intended to buy.

Scott Bennett, 48, of Hillsborough, went into the Circle K convenience store on Dec. 19 and asked the clerk for one Tri-State Megabucks ticket and one Lucky for Life ticket. The clerk mistakenly sold him two Megabucks tickets.

He never got the Lucky for Life ticket, but that probably doesn't matter now, because one of the Megabucks tickets was a big winner.

At a press conference on Friday, the Bennett family - minus Scott, who was at work - appeared to accept the prize.

Cathy Bennett, Scott's 47-year-old wife, said this Christmas "there might be a few extra presents under the tree."

She described the experience as "surreal."

"It's very overwhelming but I think once everything settles we'll enjoy and take the time to enjoy it and decide what the future's going to hold," she said, according to ABC News affiliate WMUR TV in Manchester, N.H.

The Bennetts have three children. It was their son, Travis, 20, who set things in motion. He left a note saying a winning ticket had been sold in their neighborhood and urging his father to check the numbers on his ticket.

"I went downstairs, and he was sitting there with the ticket in one hand and the New Hampshire Lottery website on the computer, just staring at both of them," Cathy Bennett said, recalling her husband at the computer. "We must have checked them about 15 times. We really truly didn't believe it."

When they found out they'd won, they called a family meeting and ordered in Chinese food.

The Bennetts opted to take the lump sum payment of about $1.3 million, and will use it to pay down debt, remodel the kitchen in their recently purchased Victorian home and fund their children's college education.

Scott Bennett works in property management and his wife is an elementary school paraprofessional, the Union Leader newspaper reported. They both plan to keep their jobs.
As it turns out, the Bennetts weren't the only lucky ones.

The Circle K receives $21,500 for selling the winning ticket, and the owner plans to share some of the money with his workers, including Nicki Gee, the 24-year-old clerk who sold the ticket.

"He (Bennett) came in yesterday to thank me and said I had made a very good mistake," she said.

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Gallery: The 10 States That Pay Out the Biggest Lottery Jackpots

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D.C. Man Sues Comcast Over Error That He Claims Cost Him $26,000

ABC News — Mon, 17 Dec 2012 12:03:00 EST

Filed under: Company News, Media, Citigroup, Credit, Consumer Ally

By Abby Ellin

In June 2010, Marc Himmelstein called Comcast (CMCSA) of the District LLC to cancel his cable and high-speed Internet services in his Northwest Washington, D.C., home, Courthouse News reported.

Comcast told Himmelstein he was due a refund of $123.19. The company's equipment was removed from Himmelstein's home, but a modem was accidentally left behind, and Himmelstein was charged $220, according to a complaint filed in U.S. District Court for the District of Columbia on Sept. 6, 2012.

Himmelstein, the CEO of National Environmental Strategies, a D.C. lobbying firm, had no idea that he still had the modem, or that he owed Comcast a dime. He learned about his "debt" in August 2010 when he called Comcast to ask about the $123.19 refund.

He was told that as soon as he returned the missing modem, the charge would be removed. That is exactly what Himmelstein did, and he contacted Comcast "on at least three occasions," according to the court filing, to make sure it had received the modem. While Himmelstein didn't receive a written notice, he was informed Comcast had fixed the error, and that his refund was en-route, the filing states.

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Except it wasn't. Not only did Himmelstein never receive the $123.19 refund, he had no idea that the $220 charge had been forwarded to Credit Protection Association, and that in December 2010, CPA had reported the late charge to three national credit-reporting agencies.
Himmelstein is not the only unhappy Comcast customer who has experienced difficulties with the cable service. There is an "I Hate Comcast" Facebook page, along with an anti-Comcast blog set up in 2009, targeting Comcast.

Himmelstein said he learned about the credit reporting filing in the spring of 2011, when he tried to refinance his mortgage with Citibank (C), and his credit report showed that his account was in arrears thanks to the Comcast charge. According to the claim, "because of this outstanding debt, Citibank required Himmelstein to pay an additional $26,000 (1 percent of the value of the mortgage) for the same loan." He paid it.

Himmelstein and his lawyer, Matt Finkelstein, of Bethesda, Md., filed a breach of contract claim and negligence against Comcast in D.C. federal court. They have also sued the Credit Protection Association for negligence and violation of the Fair Credit Reporting Act. Himmelstein is seeking to recoup the $26,000 that Citibank required him to pay to refinance his mortgage, attorney fees and the $123.19 credit he was owed when he first closed his account, which he has still not received.

On Oct. 22, Comcast filed a motion to dismiss all charges. Last week, District Judge James Boasberg partially dismissed claims for constructive fraud and a "bad faith" breach of contract.

"The accounting mistakes made by Comcast in handling Himmelstein's account - while unquestionably frustrating - do not raise an inference of bad faith sufficient to state a claim for breach of covenant," Boasberg wrote.

But Boasberg refused to dismiss the negligence claim against Comcast because, he wrote, unresolved questions remain about the company's duty to Himmelstein.

Both Comcast and Himmelstein declined to comment to ABC News. CPA did not return phone calls from ABC News.

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What the Average American Should Know About the Capital Gains Tax

ABC News — Thu, 13 Dec 2012 06:00:00 EST

Filed under: Costco, Investing Basics, Taxes, Barack Obama, Investing

One of the most contentious issues in the debate over how the federal government can increase its revenues may be a difference of almost 8 percentage points, and it has encouraged over a hundred companies to scramble to issue special dividend payments to shareholders ahead of the New Year. It's called the capital gains tax, and it's the tax paid on the difference between the sale price of an investment asset, like a stock, and its cost.

The long-term capital gains tax rate on most investment assets is generally 15 percent now. Compensating highly-paid employees through capital gains, such as stock holdings, is a favored method among the wealthy because that's lower than the top statutory rate on ordinary income, which is 35 percent. But President Obama has proposed to increase the top capital gains tax rate to 23.8 percent. There are exemptions such as with the sale of a home.

The highest rate for dividends, period payments that some companies distribute to shareholders, could increase to 43.4 percent from 15 percent.

The compensation of Rick Schottenfeld, chairman and CEO of Schottenfeld Group Holdings, based in New York City, is a mix of long-term and short-term capital gains, depending on how "successful" his investments are, he said.

A registered Republican, Schottenfeld has been vocal about raising the capital gains tax despite the fact that doing so will lower his income.

Schottenfeld is a member of the Patriotic Millionaires, a group of over 200 Americans with incomes over $1 million a year who are petitioning lawmakers to increase taxes for the wealthy to help plug the budget deficit, which has topped $1 trillion over the last four years.

"This whole process of lowering taxes to create jobs has led to bigger deficits, and made it so we can't afford to pay for things we need," he said. "There's obviously a need for spending cuts. It's an arithmetic problem that needs to be met in the middle. We've overshot on capital gains."

While many executives or employees who are able to negotiate their salaries often have a decision to get paid in stock holdings, people with middle or lower incomes usually do not.

"They really aren't given the opportunities like that to convert your income," he said. "How many teachers have big long-term capital gains to take advantage of?"

One of the arguments in favor of keeping the capital gains tax low is that it will be a tradeoff if the general income tax rate for high-income households increases to 39.6 percent from 35 percent, as President Obama has proposed. Households above a specific threshold, $250,000 for married couples and $200,000 for others, will pay an additional 0.9 percent tax on their earnings to finance new healthcare provisions.

Many mainstream economists argue for taxing capital at a lower rate than ordinary income to create an incentive to save or re-invest, said Joseph Rosenberg, research associate with Urban-Brookings Tax Policy Center.

"A high capital income tax would sort of discourage saving and consuming out of your current income, so less capital is available in the economy and for investment," he said.

The Treasury Department reported in its budget for the 2013 fiscal year that increasing the capital gains tax rate to 20 percent would bring in about $36 billion in tax revenue over 10 years. Taxing dividends as ordinary income would bring in an even larger piece of the pie: $200 billion over 10 years.

If all scheduled tax increases take place as scheduled in 2013, they will generate $536 billion of revenue in 2013. The increase could net $5 trillion over ten years, the Tax Policy Center states.

"No single policy is enough on its own, but as part of the overall package, it's significant," said Rosenberg. "But perhaps more importantly is who's being affected to the extent that we care about not only the revenue but distribution of taxes."

The change in taxation of capital gains and dividends "overwhelmingly" affects the top of the income distribution. Specifically, if the Bush tax cuts for high-income earners from 2003 for capital gains and dividends expire, then only 1 percent of taxpayers would be affected, all in the top income quintile, according to the center.

Kelly Erb, a tax attorney, said many middle-income taxpayers often carry most of their financial assets, outside of their homes, in mutual funds or retirement accounts such as 401(k)s. Those are often tax-deferred financial vehicles from which account holders withdraw money at retirement age. At that point, they are usually taxed as ordinary income.

For individuals who have stock holdings this year, Erb said most individuals should not necessarily sell their appreciated stock holdings in anticipation of the increase in capital gains and dividends tax rates.

"I don't think you should change your behavior," she said. "I think you should look at the timing of your behavior."

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Because the capital gains tax rate applies to assets that have appreciated in price, some investors may benefit from waiting until the New Year if a stock's price is decreasing but hasn't yet led to a net capital loss.

"You may have the opportunity to offset capital losses at a higher rate," she said.

On the other hand, if an investor was planning to sell an asset anyway, it helps to talk with a financial professional or broker about how it has affected your portfolio.

"By December, you know what your gains are for the year usually. That's why they say to get rid of underperformers then," she said.

Erb said the uncertainty for regarding the tax rates is unfair to taxpayers, but particularly to low and middle-income taxpayers who can't afford to pay for professional advice to strategize their financial plans.

Dozens of companies have announced special dividends to shareholders late this year, including Costco Wholesale Corp. (COST), to avoid anticipated tax increases.

"I think it's impossible to plan," Erb said for most individuals. "I think people should be angry at Congress for putting us in this predicament."

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Miami Businessman Claudio Osorio Arrested for Allegedly Swindling Millions From Investors

ABC News — Mon, 10 Dec 2012 14:24:00 EST

Filed under: SEC, Investment Fraud, Ripoffs & Scams, Investing

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By Suzanne Yeo

A Miami businessman whom Ernst & Young once named "Entrepreneur of the Year" has been accused of swindling $40 million from investors, including some NBA stars, to support a lavish lifestyle.

Venezuelan-born Claudio Osorio, 54, was arrested Friday and charged with 23 counts of fraud and money laundering for exaggerating the success of his company, InnoVida, between March 2007 and March 2011, according to a Securities and Exchange Commission's complaint.

Craig Toll, 64, InnoVida's chief financial officer, was also charged along with his former boss.

Toll's attorney Richard Klugh released a statement to ABC News saying his client was "an honorable employee of the company and should not have been charged with anything."

Neither Osorio nor his attorney has responded to requests for comment. It's unclear whether the two men are still in custody.

Osorio allegedly took the money from about 10 investors, telling them that InnoVida produced building panels used to construct houses and other structures resistant to fires and hurricanes. Authorities say the high-flying businessman lured potential investors with false financial statements and high-profile connections, including a blue-chip board of directors that included former Florida Gov. Jeb Bush, who has not responded to a request for comment.

Osorio used the money to finance a lifestyle that included a $12 million mansion on Miami Beach's exclusive Star Island, which boasts nine bedrooms and a swimming pool with a gazebo. Osorio also illegally used investor money to buy a Maserati, a Colorado mountain retreat home and country club dues, according to the SEC complaint.

"From his lap of luxury, Osorio concocted a compelling story about InnoVida by recruiting an impressive board of directors and boasting a bogus financial condition to lure investors into funding his scheme of lies," Eric Bustillo, director of the SEC's Miami Regional Office, said in a news release.

Osorio allegedly even duped the likes of current and former basketball stars Dwight Howard, Alonzo Mourning and Carlos Boozer.

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"Individuals who are looking for investors very often will have celebrities involved either as investors or on the board of their entity in order to give an air of credibility and attract other people to invest with them and we see that very often," said Dan Schorr, of Kroll Advisory Solutions, who has no connection to the case.

The SEC says that Osorio told one investor that InnoVida was valued at $250 million, and then a week later told a different investor that the company was worth $50 million.

Another one of Osorio's alleged victims was Miami businessman and lawyer Chris Korge, who says he met Osorio in 2008. The two men became close and Korge eventually invested $4 million in InnoVida, he says.

"Everything about the company added up," Korge told ABC News. "Once he got everything he could get from me, I started to notice the interaction I had with him started to slow down,"

Korge and others eventually filed lawsuits against Osorio, forcing InnoVida into bankruptcy in 2011 and his Star Island mansion was auctioned off.

"He convinced me that this was the opportunity of a lifetime," Korge said. "He was a fraudster and a sociopath."

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