Back in 2005 I wrote about Derivium Capital. They were under investigation by the IRS & FTB for making loans that converted capital gains to nothing! for tax purposes. A great scheme, if you can get away with it.
Well, the Department of Justice filed suit to stop the scheme. The defendants are Derivium Capital, LLC, Derivium Capital (USA) Inc., and Veridia Solutions LLC. Four individuals were named in the suit. The DOJ is asking for a permanent injunction to stop the loans; the lawsuit claims that the scheme has cost the US Treasury over $230 million.
Though Derivium is in bankruptcy, the lawsuit alleges that the individuals involved are still trying to peddle the loans. My advice from back in September 2005 was if it sounds too good to be true, it probably is. In this case, not only are the defendants in trouble, but if you happen to have “bought” a Derivium loan, or are considering buying one today, you will have problems with the IRS.
