[ by Melanie Gretchen ] A Long Island-based investment firm succeeded in having a corp of sales agents pitch its securities with the false promise that they could generate returns as high as 12% to 14% in a several week period.  Unfortunately for their investors, the securities they purchased were non-existent. SEC Findings and Allegations. The SEC charged 14 sales agents, on the grounds that they misled investors and illegally sold securities for Agape World, Inc., a Long Island-based investment firm in a $415 million Ponzi scheme.  The agents, including 4 sets of siblings, sold investments in Agape's securities investments on the premise of high returns and the false expectation that only 1% of their principal would be at risk.  [CI Note: Considering the fact that the Agape securities were non-existent, investor risk from the get-go was actually 100%]. The Scheme. When making their pitch, the sales agents misrepresented to investors that their money would go toward funding high-interest bridge loans to commercial borrowers or businesses that accepted credit cards.  Instead, most of the funds were used for Ponzi scheme payments and for agents’ sales commissions;  another $80 million was lost by Agape's president and organizer of the scheme, Nicholas Cosmo, while trading futures in his personal accounts. Risky Business. Throughout the scheme, sales agents ignored red flags of fraud - [C-I: If they ever were looking for them.] being more interesting in the $52 million in commissions they earned for their efforts.  Warnings included the earlier conviction on fraud charges of Agape president Cosmo.  None of the sales agents were registered with the SEC to sell securities, nor were they associated with a registered broker or dealer.  Agape also was not registered with the SEC;  nor were its securities.  And, if they cared to look, they would have developed some concern about the firm's relatively small and unknown status as a private issuer of securities, as well as Agape’s series of extensions and defaults, and other dire warnings about Agape’s financial condition. Who Was Hit. More than 5,000 investors nationwide were affected, according to the SEC’s complaint filed in the U.S. District Court for the Eastern District of New York, from 2005 to January 2009, when Cosmo was arrested. "This Ponzi scheme spread like wildfire through Long Island’s middle-class communities because this small group of individuals blindly promoted the offerings as particularly safe and profitable.  These sales agents raked in commissions without regard for investors or any apparent concern for Agape’s financial distress and inability to meet investor redemptions." -- Andrew M. Calamari, Acting Regional Director for the SEC’s New York Regional Office. SEC Sanctions. The SEC’s complaint charged sales agents Bryan and Hugo Arias, Anthony and Salvatore Ciccone, Jason and Michael Keryc, Dunne, Hartmann, Kaylor, Massaro, and Laura Ann Tordy with violations of Section 17(a) of the Securities Act of 1933, and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. All 14 agents violated Section 15(a) of the Exchange Act, and Sections 5(a) and 5(c) of the Securities Act.  The president of the firm, Cosmo, was later sentenced to 300 months in prison and ordered to pay more than $179 million in restitution. For further details, go to [SEC, 6/12/12] and the [SEC complaint].