Reed Eliot Slatkin (January 22, 1949 – June 23, 2015) was an initial investor and co-founder of

EarthLink EarthLink is an American Internet service provider. Earthlink went public on NASDAQ in January 1997. Much of the company's growth was via acquisition. In 2000, ''The New York Times'' described it as the "second largest Internet service provider ...

and the perpetrator of one of the largest

Ponzi scheme A Ponzi scheme (, ) is a form of fraud that lures investors and pays Profit (accounting), profits to earlier investors with Funding, funds from more recent investors. Named after Italians, Italian confidence artist Charles Ponzi, this type of s ...

s in the history of the

United States The United States of America (USA), also known as the United States (U.S.) or America, is a country primarily located in North America. It is a federal republic of 50 U.S. state, states and a federal capital district, Washington, D.C. The 48 ...

. Slatkin had been an ordained

Scientology Scientology is a set of beliefs and practices invented by the American author L. Ron Hubbard, and an associated movement. It is variously defined as a scam, a Scientology as a business, business, a cult, or a religion. Hubbard initially develo ...

minister since 1975. Around 1984, he changed from being a full-time minister to becoming a self-employed investor, and many of his investment clients and victims were also Scientologists.

Ponzi scheme

From 1986 to 2001, Slatkin raised approximately $593 million from about 800 wealthy investors. Using the funds from later investors, he paid one group of early investors $279M on their original $128M investment, citing investment success without actually making most of the claimed investments. He also distributed millions in fees to associates as "consultants". An investigation by the

U.S. Securities and Exchange Commission The United States Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street crash of 1929. Its primary purpose is to enforce laws against market m ...

(SEC) shut down the scheme in 2001. In May 2001, the SEC shut down Slatkin's scheme by filing an enforcement action and obtaining a temporary restraining order freezing his remaining assets. On the same day as the SEC action, the Federal Bureau of Investigation executed search warrants relating to Slatkin. The SEC brought the civil case in ''SEC v. Slatkin'', Civil Action No. 01-04823 (C.D. Cal.). The

Central District of California The United States District Court for the Central District of California (in case citations, C.D. Cal.; commonly referred to as the CDCA or CACD) is a federal trial court that serves over 19 million people in Southern and Central California, m ...

brought the criminal case in ''U.S. v. Reed E. Slatkin'', CR 02-313 (C.D. Cal.). He funneled millions of dollars to the

Church of Scientology The Church of Scientology is a group of interconnected corporate entities and other organizations devoted to the practice, administration and dissemination of Scientology, which is variously defined as a cult, a business, or a new religiou ...

and related entities, and many of his victims were Scientologists. Victims of his scheme include actors

Joe Pantoliano Joseph Peter Pantoliano (born September 12, 1951) is an American actor who has played over 150 roles across film, television, and theater. He is best known for portraying Francis Fratelli in '' The Goonies'' (1985), Captain Conrad Howard in th ...

Anne Archer Anne Archer (born August 24, 1947) is an American actress. Archer was named Miss Golden Globe in 1971, and in the year following, appeared in her feature-film debut '' The Honkers'' (1972). She had supporting roles in '' Cancel My Reservation'' ...

, Giovanni Ribisi, producers

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and Armyan Bernstein, film composer

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, and commentator Greta Van Susteren.

Guilty plea and post-conviction

Slatkin pleaded guilty to

mail fraud Mail fraud and wire fraud are terms used in the United States to describe the use of a physical (e.g., the U.S. Postal Service) or electronic (e.g., a phone, a telegram, a fax, or the Internet) mail system to defraud another, and are U.S. fede ...

wire fraud Mail fraud and wire fraud are terms used in the United States to describe the use of a physical (e.g., the U.S. Postal Service) or electronic (e.g., a phone, a telegram, a fax, or the Internet) mail system to defraud another, and are U.S. fede ...

money laundering Money laundering is the process of illegally concealing the origin of money obtained from illicit activities (often known as dirty money) such as drug trafficking, sex work, terrorism, corruption, and embezzlement, and converting the funds i ...

, and

obstruction of justice In United States jurisdictions, obstruction of justice refers to a number of offenses that involve unduly influencing, impeding, or otherwise interfering with the justice system, especially the legal and procedural tasks of prosecutors, investiga ...

and on September 2, 2003, he was sentenced to 14 years in federal prison. His

Federal Bureau of Prisons The Federal Bureau of Prisons (BOP) is a Federal law enforcement in the United States, federal law enforcement agency of the United States Department of Justice that is responsible for all List of United States federal prisons, federal prisons ...

registration number was 24057-112 and he was initially incarcerated at the low-security Taft Community Correctional Institution in

Taft, California Taft (formerly Moron, Moro, and Siding Number Two) is a city in the foothills at the extreme southwestern edge of the San Joaquin Valley, in Kern County, California. Taft is located west-southwest of Bakersfield, California, Bakersfield, at an ...

. By 2010, he had been transferred to the low-security Lompoc Federal Correctional Institution in

Lompoc, California Lompoc ( ; Chumashan ) is a city in Santa Barbara County, California, United States. Located on the Central Coast, its population was 43,834 as of July 2021. Lompoc has been inhabited for thousands of years by the Chumash people, who called t ...

. Many of his victims were also Scientologists. In his fraud case, his lawyers blamed his behavior on Scientology; but Scientology's lawyers from

Latham & Watkins Latham & Watkins LLP is an American multinational law firm. Founded in 1934 in Los Angeles, California, Latham is the second-largest law firm in the world by revenue. As of 2022, Latham is also one of the most profitable law firms in the world ...

characterized Slatkin's explanations as "shameful" and having "sold the psychiatrists a bill of goods". In July 2013, he was released from a halfway house in

Long Beach, California Long Beach is a coastal city in southeastern Los Angeles County, California, United States. It is the list of United States cities by population, 44th-most populous city in the United States, with a population of 451,307 as of 2022. A charter ci ...

. On June 23, 2015, journalist Tony Ortega reported on his website that Slatkin had died from a heart attack. Ortega said that he had confirmation of Slatkin's death from Slatkin's ex-wife.

In popular culture

In February 2008, the television show '' American Greed'' featured the Slatkin case, titled "Stealing $$$ from Scientologists".

References

External links

*
Reed E. Slatkin sentenced to 14 years for running a $600 million Ponzi scheme and obstructing justice
U.S. Securities and Exchange Commission Litigation Release No. 18323, September 4, 2003.
Reed Slatkin Media ResourceBankruptcy site set up by a group of Slatkin investors
{{DEFAULTSORT:Slatkin, Reed 1949 births American people convicted of money laundering 20th-century American Jews American Scientologists Cranbrook Educational Community alumni Pyramid and Ponzi schemes Scientology-related controversies American people convicted of fraud American prisoners and detainees American businesspeople convicted of crimes 2015 deaths American members of the clergy convicted of crimes American people convicted of obstruction of justice 21st-century American Jews Prisoners and detainees of the United States federal government