Backed by unrealistically ambitious owners, well-intentioned business ideas that fail to meet expectations or become unsustainable regrettably often become full-fledged Ponzi schemes. Today’s Growth Consultant, Inc. (“TGC”) represents an entity that faced the same fate.
TGC advertised to potential investors its expertise in building, acquiring, and monetizing online websites. Investors paid an upfront fee to TGC to purchase, host, maintain, and market the investors’ websites in exchange for TGC’s guarantee that investors would receive a minimum rate of return in perpetuity on the revenues TGC generated from those websites. TGC raised at least $75 million during a nearly three year period, but its business model proved unsuccessful—it failed to timely purchase and build the promised websites or generate the promised revenue to cover the guaranteed returns to investors. Instead, TGC turned into a Ponzi scheme to sustain its failing business by paying early investors with money it raised from later investors.
TGC maintained its business bank accounts at Defendants Heartland Bank and Trust Company (“Heartland”) and PNC Bank, N.A. (“PNC”) (collectively, “Defendants”). TGC banked with Heartland until October 2018, and with PNC thereafter until December 2019. Defendants provided TGC with typical banking services, including deposit accounts, commercial loans and revolving lines of credit, ACH capabilities, and transfers into, out of, and…
