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. It went public on NASDAQ in January 1997. Much of the company's growth was via acquisition; by 2000, ''The New York Times'' described Earthlink 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 profits to earlier investors with funds from more recent investors. Named after Italian businessman Charles Ponzi, the scheme leads victims to believe that profits are comin ...

s in the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...

since that conducted by

Charles Ponzi Charles Ponzi (, ; born Carlo Pietro Giovanni Guglielmo Tebaldo Ponzi; March 3, 1882 – January 15, 1949) was an Italian swindler and con artist who operated in the U.S. and Canada. His aliases included ''Charles Ponci'', ''Carlo'', and ''Cha ...

himself. Slatkin had been an ordained

Scientology Scientology is a set of beliefs and practices invented by American author L. Ron Hubbard, and an associated movement. It has been variously defined as a cult, a Scientology as a business, business, or a new religious movement. The most recent ...

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". He successfully sustained the scheme until 2001, when it was shut down by an investigation by the U.S. Securities and Exchange Commission (SEC). 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 civil case was brought by the SEC in ''SEC v. Slatkin'', Civil Action No. 01-04823 (C.D. Cal.). The criminal case was brought by the U.S. Attorney for the Central District of California in ''U.S. v. Reed E. Slatkin'', CR 02-313 (C.D. Cal.). Among his victims were actors

Joe Pantoliano Joseph Peter Pantoliano (born September 12, 1951) is an American character actor who has appeared in over 150 films, television and stage productions. After his early roles in the television series '' M*A*S*H'' and the 1983 comedy '' Risky Bu ...

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'' ...

and Giovanni Ribisi (the latter two being Scientologists), producers

Art Linson Art Linson (born 16 March 1942) is an American producer, screenwriter and author. Life and career Linson was born in Chicago, Illinois. He did his undergraduate work at the University of California-Berkeley and graduated from the University of ...

(father of high-ranking Scientologist Jenny Linson) and

Armyan Bernstein Barry "Armyan" Bernstein (born August 12, 1947) is an American film producer, director and screenwriter. He is the co-founder and chairman of film company Beacon Pictures. Career Bernstein has produced, executive produced, written or direct ...

, and two additional Scientologists, film composer

Mark Isham Mark Ware Isham (born September 7, 1951) is an American musician and film composer. A trumpeter and keyboardist, Isham works in a variety of genres, including jazz and electronic. He is also a film composer, having worked on numerous films and ...

and commentator Greta Van Susteren. as well as key people of

, including Scientologist

Sky Dayton Sky Dylan Dayton (born August 8, 1971) is an American entrepreneur and investor. He is the founder of Internet service provider EarthLink, co-founder of eCompanies, and the founder of Boingo. Early life Dayton's father was the sculptor Wen ...

. 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 religious ...

and their related entities.

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 or electronic mail system to defraud another, and are federal crimes there. Jurisdiction is claimed by the federal government if the illegal activity ...

wire fraud Mail fraud and wire fraud are terms used in the United States to describe the use of a physical or electronic mail system to defraud another, and are federal crimes there. Jurisdiction is claimed by the federal government if the illegal activity ...

money laundering Money laundering is the process of concealing the origin of money, obtained from illicit activities such as drug trafficking, corruption, embezzlement or gambling, by converting it into a legitimate source. It is a crime in many jurisdicti ...

, and

obstruction of justice Obstruction of justice, in United States jurisdictions, is an act that involves unduly influencing, impeding, or otherwise interfering with the justice system, especially the legal and procedural tasks of prosecutors, investigators, or other gov ...

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 United States federal law enforcement agency under the Department of Justice that is responsible for the care, custody, and control of incarcerated individuals who have committed federal crimes; that i ...

registration number was 24057-112 and he was initially incarcerated at the low-security Taft Community Correctional Institution in Taft, California. By 2010, he had been transferred to the low-security Lompoc Federal Correctional Institution in

Lompoc, California Lompoc ( ; Chumash: ''Lum Poc'') is a city in Santa Barbara County, California. Located on the Central Coast, Lompoc has a population of 43,834 as of July 2021. Lompoc has been inhabited for thousands of years by the Chumash people, who calle ...

. 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 2021, 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 city in Los Angeles County, California. It is the 42nd-most populous city in the United States, with a population of 466,742 as of 2020. A charter city, Long Beach is the seventh-most populous city in California. Incorporate ...

. On June 23, 2015, journalist

Tony Ortega Anthony "Tony" Ortega is an American journalist and editor who is best known for his daily blog about the Church of Scientology called ''The Underground Bunker''. He was executive editor of ''The Raw Story'' from 2013 until 2015. Previously, ...

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 ''American Greed'' (also known as ''American Greed: Scams, Scoundrels and Scandals'' and as ''American Greed: Scams, Schemes and Broken Dreams'') is an American documentary television series on CNBC. The series focuses on cases of Ponzi schemes, ...

'' featured the Slatkin case, which it 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 money launderers People convicted of obstruction of justice 20th-century American Jews American Scientologists Cranbrook Educational Community alumni Pyramid and Ponzi schemes Scientology-related controversies American people convicted of fraud American businesspeople convicted of crimes 2015 deaths American members of the clergy convicted of crimes 21st-century American Jews