Great frauds in history: Nicholas Cosmo and the big gambles that turned sour

Nicholas Cosmo conned 4,000 investors out of a total of $195m.

Nicholas Cosmo © Getty
© Getty
(Image credit: Nicholas Cosmo © Getty)

Nicholas Cosmo was born in Long Island, New York, in 1971, and enjoyed a brief career as a minor-league baseball player. This did not lead to the success he had hoped for, so he decided to become a stockbroker instead, getting his licence to trade in 1993. Cosmo was by all accounts a good salesman, but a gambling habit got out of control and he took $177,000 from clients’ accounts to cover gambling losses. He declared bankruptcy and was jailed in 1998. Released from Federal prison in 2000, he set up Agape World Inc. with money from his parents and a government grant.

What was the scam?

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri