Alleged Ponzi-scheme victims testify in George Joseph case

Judge Scott Lipke said he would take arguments from both sides under advisement before making a decision on whether the estates of Matthew and Mary Joseph should pay losses stemming from the George Joseph Family Investment Club.

Matthew and Mary Joseph were shot and killed by George Joseph on May 30, 2013, at their home at 1220 W. Cape Rock Drive in Cape Girardeau.

Twelve of the 20 original claims were dismissed Monday after a motion from the claimants’ lawyer, John Ryan. Ryan Faeth, Adam Petroline Jr., Debbi Martinez and Priscilla Wadley collectively lost about $138,000 in investments they made with George Joseph, and they testified at the probate hearing.

Each of the investors was offered a 5 percent stop-loss limit when George Joseph discussed the terms of their investments, they testified. Joseph said he was using daytime trading options through Scottrade, Petroline testified. After six months, they were supposed to receive checks of between 5 percent and 10 percent of their investment each month.

“If any time I wanted to pull my money out, the most I could lose was 5 percent,” Debbie Martinez of Jackson testified.

Each investor received a check or two from Joseph until the money ceased, they said. They asked for their principal investment back, and Joseph ignored them, lied to them or sent checks that bounced, they said.

Petroline, of Collinsville, Illinois, invested $135,000 with Joseph and was paid back about $43,000 in checks. When he asked for his principal investment, however, Joseph sent two checks for $10,000 that bounced.

“He said he could not give it to me,” Faeth said. “One reason was because there was an FBI lawsuit. ... One was that they locked his account.”

Ryan argued life-insurance policies taken out on Matthew and Mary Joseph were paid by Joseph’s investment business, which he referred to as a Ponzi scheme in the original claim.

C. Wade Pierce, a lawyer for the estates, said Joseph was left penniless when he killed Matthew and Mary Joseph.

Estates administrator Mike Griffith, who is Mary Joseph’s brother, testified Mary Joseph had not worked full-time since 2011 and was not working when the life-insurance policies were established. Griffith also testified Mary and Matthew Joseph had no idea of George Joseph’s illegal activities.

“I asked her several times what George did. She didn’t have a clue,” Griffith said. “She didn’t know up until two days before she was shot in the head.”

Griffith also referred to a letter Matthew Joseph wrote to his father that Griffith submitted as evidence to the Cape Girardeau County prosecuting attorney’s office.

“He was bragging on him about how he had made so much money, and he wanted to be just like him,” Griffith said.

Griffith and his brother, Steven Griffith, were victims of George Joseph. Steven Griffith was represented by his bankruptcy lawyer, David Edwards, at the hearing in part because he invested money with George Joseph, Pierce said.

Mike Griffith said he invested $50,000 with George Joseph stating in 2007, and he was asking George Joseph for his principal investment for several months before the murders.

Money from the two estates paid for funeral expenses and some claims from creditors of Mary Joseph.

The family auctioned furniture after Mary and Matthew Joseph were killed, collecting between $8,000 and $8,500, Mike Griffith said. Some of that money paid for trash cleanup at the Cape Rock Drive house, Mike Griffith said.

The house was in foreclosure after Mary and Matthew Joseph were killed, and the family had to clean the house quickly, Mike Griffith said.

The vehicles the family had all were leased and repossessed later, Mike Griffith said.

“You can’t imagine how much stuff you have to move,” Mike Griffith said. “It was kind of a messed-up deal, the whole thing is.”

Pierce argued the estates were not liable for George Joseph’s debts based on Missouri law.

“Slayer law” prevents killers from benefiting directly from life-insurance policies taken out on the victims.

Pierce argued the “slayer” law also may apply.

“There’s no doubt these people have a claim against George Joseph,” Pierce said.

bkleine@semissourian.com

(573) 388-3644

Pertinent address: 44 Lorimier St., Cape Girardeau, MO