Hicksville man gets prison for gift card Ponzi scheme

A Hicksville businessman has been sentenced to 3 1/2 to 7 years in prison for scamming investors out of nearly $2.4 million in a gift card Ponzi scheme that promised steep discounts and luxury suites at sporting events, including the Super Bowl, officials said.

Craig Ginsberg, 49, who pleaded guilty in September to second-degree grand larceny, also must repay his victims, Nassau County District Attorney Kathleen Rice said in a news release Tuesday.

"In late 2006, Ginsberg told family, friends, and business associates that he could procure gift cards to stores like Target, Best Buy, Nordstrom's and Toys R Us, as well as Visa and American Express gift cards, for 50 cents on the dollar," Rice said in the release.

He told them they had to wait three months to get the cards, prosecutors said.

Ginsberg continued purchasing cards at face value, using new money from unsuspecting purchasers to keep the scheme going.

Eager to be in the discount program, new clients would "prepay thousands of dollars for more gift cards they thought were coming," Rice's office said. By April 2008, Ginsberg could no longer keep the scheme afloat.

"Maybe Ginsberg didn't use a gun to steal from his friends and family, but he acted like a highway robber just the same," Rice said in the statement, adding "he stole from his family and friends and violated their trust . . ."

Clients who invested money in 2008 received nothing, Rice's office said, and overall, "63 victims stepped forward, claiming losses totaling almost $2.4 million."

Ginsberg also told clients he could get luxury suites for New York Islanders and Knicks games and the Super Bowl, authorities said.

"Ginsberg told victims that if they fronted the money to purchase the suite from a distressed owner, he could flip it for a profit and get them a huge return on their investment," Rice said in the release.

Another scam included telling clients he could purchase "overseas timeshares from distressed owners and then sell them for a huge profit," she said in the release.

One victim reported $1 million in losses in gift-card and timeshare investments, prosecutors said. Among those who invested money were doctors, lawyers, accountants and the congregation of a South Shore temple that collected and lost $15,000, authorities said.