Who was Steven Hoffenberg?

Steven Hoffenberg, who was handed a 20-year prison sentence, along with a fine of $1 million and restitution worth $463 million for a Ponzi scheme he said he built with Jeffrey Epstein, was reportedly found dead on Tuesday, August 23, at his residence in Derby, Connecticut. He was 77 years old when he died.

The details of Hoffenberg’s death remained unknown three days after the discovery of his corpse as it was in advanced decomposition when it was found. The Derby Police Department issued a statement regarding the matter, revealing a few officers visited Hoffenberg’s apartment on August 23 around 8 pm following a welfare check request when they found the body. A police spokesperson later revealed that the initial autopsy did not reveal any trauma to Hoffenberg’s body.

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Who was Steven Hoffenberg?

Steven Hoffenberg was an American businessman who was handed a lengthy 20-year prison sentence after being found guilty of running a Ponzi scheme named Towers Financial Corporation, which was an elaborate fraud operation. He was the founder, CEO, president and chairman of the organization. His financial crimes are considered one of the largest Ponzi schemes in history.

Apart from his role in the Ponzi scheme fraud, he was a brief owner of the New York Post, following saving it from bankruptcy in 1993. 

Steven Hoffenberg was born in 1945 to a Jewish family in New York, United States. He founded Towers Financial Corporation, a debt collection agency based out of New York City in the early 1970s, the business model of which was to buy debts of people owed to hospitals, phone companies and financial institutions such as banks.

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He met Jeffrey Epstein, a multimillionaire sex trafficker, in 1987, via a reported arms dealer Douglas Leese. Leese described Epstein as a genius, who was great at selling securities with no moral compass to Hoffenberg.

Epstein was hired by Hoffenberg sometime after at Towers Financial Corporation with a salary of $25,000 every month. The duo later attempted to take over Pan Am using Towers Financial Corporation, but that failed. They also tried to take over Emery Air Freight Corp in 1988 but were unsuccessful.

Hoffenberg rescued the popular American newspaper New York Post from going bankrupt in 1993 and owned it for three months. It was the same year when the Towers Ponzi scheme came to light. The Securities and Exchange Commission (SEC) began a civil action against Hoffenberg in February and little more than two years later, the company filed for bankruptcy.

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He pleaded guilty to committing fraud against investors worth $475 million in April 1995. Steven Hoffenberg revealed Epstein’s involvement in the Ponzi scheme in court. However, Epstein left the company before the fraud was discovered and was never charged for it.

Steven Hoffenberg was arrested in February 1994 and was handed a 20-year prison sentence in 1997. He served 18 years of his sentence and was released in October 2013. He settled the civil case with the SEC for $60 million.

The former Towers Financial Corporation chief filed a case against Jeffrey Epstein in 2016. Epstein was arrested in 2019 on charges of sex trafficking. Before his death in 2022, Hoffenberg was living in his home in Derby, Connecticut.