From Parties to Ponzi: Jim and Janet Ellis Named as Defendants in Multi-Million Dollar Fraud Lawsuit
For the past few months, a number of residents in Wilton Manors have been alleging they were victims of a Ponzi scheme orchestrated by a father-daughter team, working their purported fraud in local venues, such as bars and private parties. Many of the alleged victims have resided at Wilton Station in Wilton Manors.
Fourteen residents have now put their money where their mouth is. They have filed a suit in Broward County Circuit Court, accusing George Elia, Jim Ellis, and his daughter Janet Ellis of multiple counts of fraud and deceit.
SFGN exclusively reported the stories of many of these victims in three separate issues earlier this year.The plaintiffs, including those reported in SFGN, are now suing four people and six companies for eleven counts, all involving allegations of fraud and misrepresentation. The plaintiffs include Lloyd Pagels and Ken Kelley, owners of the local popular country western gay bars, Scandals and the Stable.
The SFGN investigation revealed that Jim Ellis, a local businessman, solicited Wilton Manors residents for investments in stock plans underwritten by George Elia. Dating back to 2004, Ellis, allegedly working with his daughter Janet, a property manager for Wilton Station, was accused of enticing investors with cocktails, drinks and expensive dinners, soliciting them at lavish parties she hosted, often in the local condominium complex.
"By acting as satisfied investors," the lawsuit reads,"Jim and Janet Ellis lent an air of legitimacy to Elia's scheme." It accuses Ellis and his daughter of vouching for the security of the phony investments, thus inducing a false sense of confidence into prospective investors.The suit goes on to directly accuse Ellis and his daughter as being "every bit as involved in the scheme as Elia himself."
The riveting lawsuit claims Jim Ellis was "well-known amongst the plaintiffs...for his grandiose and lavish lifestyle," thus he was an "accomplice perfect for the role." But he is now accused of making scores of false representations,"knowing them to be false." His daughter, Janet, the suit alleges, used her position as property manager at Wilton Station, and the proprietary information she gained in that capacity, to further the fraudulent scheme.
The complaints and the lawsuit allege that Jim was able to induce potential investors into believing that Elia was a sound businessman, a stock market guru, and that their investments would be secure. Victims told SFGN they were assured of profitable returns of more than 20 percent annually, and were allegedly coaxed with guarantees and assurances from Jim. It was not to be. Investors discovered they could not get their monies back, and no accurate accounting was provided of where their monies had been placed.
This lawsuit is only part of Elia's problems today, already named as a defendant in a California suit accusing him of a separate $4 million dollar fraud. He had left the United States with his wife, only to return to Las Vegas, where the FBI arrested him in late March, charging him with wire fraud. Elia is now sitting in a cell of the Miami- Dade Federal Detention Center, having been charged with eight counts of criminality by the authorities for his previous investment scandals, known as 'Ponzi Schemes.'
The new civil suit in Broward County, however, now alleges he orchestrated his frauds in concert with accomplices Jim and Janet Ellis, who preyed on gay men, investors residing in Wilton Manors, and more specifically, Wilton Station. It accuses them of following a specific script that arranged for dinners at Capitol Grille, where diners would be given lobsters as a main course, and false representations as an appetizer. Given numerous opportunities to defend their actions to SFGN, both defendants had repeatedly declined to comment.
The lawsuit, filed by the firm of Becker and Poliakoff, accuses not only Elia, but Jim and Janet of eleven counts of common law fraud and negligent misrepresentation. One of the lawyers for the many plaintiffs is Daniel DeSouza, who told SFGN that the number of counts could rise as discovery on the case evolves."The lawsuit is a living document, and is likely to grow," he said.
"Elia and his conspirators have been robbing the defendants blind for years," DeSouza said."I think it's entirely possible that there are additional bad actors here. Anyone involved in this scam should not be comfortable that they haven't been named yet." DeSouza promised to root out "wrongdoers" through the legal discovery process.
DeSouza says the devious schemes orchestrated included false promises that monies were being secured in direct investment accounts, IRAs, and initial public offerings. Jim repeatedly told investors he himself had spent fortunes with Elia, and reassured the victims he would allow no harm to come to them. But the suit accuses him of knowing Elia was engaged in fraudulent acts for years, and being a part of them.
"This was a conspiracy between Elia, Jim, Janet, and likely others," DeSouza said."Everyone had a major part in the scam and everyone contributed to the plaintiffs' losses." DeSouza said the losses are around 2.5 million dollars.
The first and second counts of the lawsuit are Common Law Fraud and Negligent Representation. They allege that Elia and the Ellises knowingly lied to the plaintiffs, taking their money with no intention to ever uphold their side of the investment agreements.
Since the suit accuses Elia of involving his businesses, a third count alleges that the defendant engaged in a violation of the Deceptive and Unfair Trade Practice Act. The fourth count accuses the defendants of Conversion, which means that Elia and the others essentially stole the plaintiffs' money, converting the rightful ownership from theirs to his.
The fifth count - the only one directed solely at Elia and his companies- is a Breach of Fiduciary Duty.This means that Elia failed to follow a standard of care he owed to the plaintiffs, purposely violating the agreements he signed with them.
The sixth and seventh counts are Unjust Enrichment and Civil Conspiracy. These are charges which jointly allege that Elia and the Ellises knowingly and unlawfully conspired against the plaintiffs, allowing themselves to be unjustly enriched with money that should never have been theirs to acquire or misappropriate.
The eighth count in the complaint charges the defendants with Aiding and Abetting a Fraud, purposefully and knowingly defrauding the plaintiffs of their money and using it not for investments as promised, but for other self-serving interests, fully aware those purposes were illegal. The final three counts allege that all the defendants violated state and federal statutes pertaining to financial investments, disclosure laws, and legal obligations.
"Our collective hearts go out to the plaintiff group," attorney Daniel DeSouza said, commenting that the defendants took advantage of long-time friendships and relationships as a means to their corrupt ends.
"Elia and [Jim] Ellis knew that they were soliciting funds from people who couldn't afford to lose them," DeSouza said."But it did not stop them."
He promised to bring justice to the table with this lawsuit.
Editor's Note: The defendants will be invited to reply to SFGN if they so wish, and we will report on their defenses either way when their answers are filed in circuit court.