Kimberly Blough 6:28 p.m., March 9
Economist Laffer Sued Again
Arthur Laffer, former San Diegan and supply side economist who is generally considered the primary force behind the Reagan tax cuts of the 1980s, was sued in a Texas court Jan. 11 for alleged involvement in a Ponzi scheme. Some 52 Texas investors claim defendants took $3.1 million. Laffer was paid a fee to increase the credibility of the scheme, according to the suit.
Laffer took his company, Laffer Associates, to Nashville from San Diego in early 2007 or thereabouts, as far as I have been able to determine. In September of 2006, the defendant firm invested in Business Radio Network and by December of that year had invested $1.5 million in it.
The suit charges the network with being a Ponzi. Laffer invested with other defendants through the entity of Laffer Frishberg Wallace Economic Opportunity Fund. A spokesman for Laffer Associates told Courthouse News Service that Laffer is no longer associated with that fund.
In 2004, Laffer was sued for his alleged role in a San Diego company called Qualmag. Again, Laffer was charged with lending his name to enhance credibility. The suit was settled but the jury exonerated Laffer. In 1990, Laffer was paid $5,000 to tout a multi-level marketing scheme called FundAmerica. He plugged it in a video.
The founder of FundAmerica was charged in Florida with running a pyramid scheme. In 2002, Forbes magazine criticized Laffer for his involvement in Casmyn Corp., which mined gold in Zambia and Zimbabwe and collapsed in scandal. Laffer told me that he had gotten out of Casmyn.