The 20-Year-Old EDM Entrepreneur Accused of Running a $500,000 Ponzi Scheme
Ian Bick has been organizing dances and EDM events for Connecticut teens since he was 15, but the federal government is now accusing him of running a much darker and more complex side hustle.
Photo of Danbury, Connecticut, via Flickr user Dougtone
Ian Bick has crammed a lot of living into his 20 years. For one thing, he's a budding nightlife mogul; as a teen he ran Tuxedo Junction in downtown Danbury, Connecticut, a venue for EDM shows that's had a few dust-ups with police and the city over booze regulations. He's also, if the feds are to be believed, the mastermind behind a Ponzi scheme that raked in $500,000, money he and his buddies used to cavort around California, Key West, and New York City. He allegedly bought jet skis, stayed at the W Hotel, and shopped at Gucci and Tiffany's while using money from new investors (who thought they were investing in shows and an eBay business) to pay off the old.
According to US Attorney Deirdre M. Daly's office, in the course of the supposed scheme, he also allegedly lied to a Postal Inspector and falsified financial records.
The most amazing thing about Bick—who's out on $250,000 bail after getting charged in January—is not his alleged misdeeds, but the fact that he was doing all of this while still a teenager.
"That is the youngest I have ever heard of," says Kathy Bazoian Phelps, an attorney who runs the Ponzi Scheme Blog. She says the average age of a schemer "is in the 50s with the outliers much older."
On THUMP: What the Heck Is Post-Internet Music?
A Ponzi scheme, named after one of its earliest modern practitioners, involves collecting money for a supposed business venture, using dough from new investors to pay previous ones, and pocketing the rest while making little or no effort to actually invest in anything. Typically, the perp "is someone with a track record in business," according to Phelps. "That's how he creates an air of legitimacy." The con artist usually starts with family and friends; once they get paid, the "investment opportunity" spreads through social circles. Others soon want in, creating a financial house of cards that often comes down when the schemer runs out of cash to pay the growing ranks of investors.
In the Bick case, the seeds allegedly got planted among Connecticut teenagers and spread outward, enveloping parents and the broader community.
Danbury is a small city with a median household income of about $65,000, well over the national average. But it sits atop Fairfield County, a refuge of hedge fund managers and Wall Street commuters. The children of Danbury often spend their lives in the shadows of hulking country estates and the waterfront homes of Candlewood Lake, many of them paid for by exponential returns on investments and an endlessly self-replicating money cycle.
According to the feds, they were clueless to an adolescent take on Bernie Madoff–style deception that went on right under their noses.
Within the city, Bick enjoyed a reputation as a business whiz kid. In middle school, he sold soda and candy for a profit in a city park. In high school, he put on well-attended DJ shows and hosted an EDM "teen night" at Tuxedo Junction, already a long-standing city nightclub. A classmate who eventually invested with Bick and did not want to reveal his name recalls him as a quiet guy who kept to himself, but also an industrious type. "He was always known for these dances, always known for planning things," the classmate says.
Bick, now 20, did speak to me for this story, though he declined to answer questions related to the federal indictment (including, "Do you own a jet ski?"). Soft-spoken and patient, he outlined his short path from high-school social butterfly to club owner.
He planned his first event at age 15, a benefit for the Dorothy Day House at Danbury's Matrix Conference and Banquet Center. "We did a dance and we raised $2,000 in admission and $1,500 in [charity] bracelets," Bick tells me. "It made me see that you could make money in this business."
To celebrate the end of his sophomore year, Bick says he hired DJs and rented the Palace Theatre, a 1920s-era downtown Danbury venue that today gets sporadic use. Two hundred people showed up, and teen night at Tuxedo followed, where Bick initially charged a $10 cover and later raised it to $15.
After graduating from Danbury High School in 2013, Bick says, he had little interest in college and dedicated himself to the nightlife scene. He linked up with an EDM promoter in Rhode Island and started putting on shows in Danbury and around the Kingston campus of the University of Rhode Island.
The building that housed Tuxedo Junction had a separate bar space, one that had been dormant for a while, so Bick decided to rent it from the owners, opening the Sky Bar and Longue. That spot folded after six months, but in August 2014, Bick heard that Tuxedo Junction might close, too, and stepped in to purchase the place. Tuxedo has a storied history: In the 90s, Western Connecticut State University students caught alternative rock bands traveling between New York to Boston there. The venue had a knack for booking acts that eventually went multi-platinum, with Korn, Blink-182, Jewel, and Oasis all gigging there on the way up.
But shows had become irregular in recent years, and Bick wanted to make Tuxedo Junction a destination again.
As for where a teenager got the money to buy one business and then another, Bick says he raised it through "family and friends." His father owns a catering company (actually) called Some Things Fishy. Plus, Bick owned the businesses, not the buildings, meaning he just needed cash for operating costs.
Almost immediately, Bick developed a sour relationship with local cops. This summer, the city revoked Tuxedo Junction's entertainment license for a month, citing three prior alcohol-related violations. However, Bick, who does not have a liquor license, says police only cited him twice in his capacity as club owner. Once, police claimed someone brought booze into the venue. In the second incident, Bick claims, he had rented out Tuxedo Junction and the outside event planners hired a catering company with a liquor license, and the caterers allegedly served someone underage. "I heard about it after the fact," he says.
The videographer he hired to fill the venue's YouTube page paints of a picture of a Red Bull-fueled funhouse full of smoke machines, glow sticks, pulsating beats, tattooed MCs, fishnet-clad dancers, and oceans of jumping teens. Bick appears on the channel, spouting maxims like some kind of business guru. "If you have the will to never, ever, give up, no matter what, then you're going to make it," he says, "and I'm nowhere close to making it yet, but I know in my heart I'm going to make it." In coverage both positive and negative, the Danbury News-Times referred to Bick as a "young entrepreneur" and "teenage businessman."
According to US attorneys, while Bick was launching his career as a small-city rave impresario, he had a criminal side gig.
Starting in his senior year of high school, Bick and a friend, John Wrobel, allegedly started soliciting investors for an eBay business. (Wrobel is deemed "a co-conspirator in the scheme" in the government's trial memorandum, but has not been charged. When contacted, he declined to be interviewed.) According to the feds, the plan was to purchase eBay user accounts with pre-established high positive feedback ratings, buy electronics wholesale, and then sell them on the site for a steep markup. (Bick would only confirm to me that he had, at one time, had an eBay business.)
The first investors were high school classmates, who knew Bick as a promoter prodigy, according to the feds. Bick "falsely and fraudulently" claimed "he was successfully promoting concerts and generating profits from various events," when, the indictment claims, his shows made little money.
When Bick's first round of investors got paid, more wanted in, according to prosecutors, and the scheme spread from classmates to friends of friends to their parents and so on. A microcosm of this process allegedly infected the Sigma Pi fraternity at the University of Rhode Island. Bick's high school friend is a brother and the teen businessman traveled to the school and recruited investors in 2013, according to another Sigma Pi brother, who asked that his name not be used.
That fraternity member recalls Bick as "chubby" and "dorky," but business-savvy. "He said he could buy [PlayStation] 4s for $100 and sell them [on eBay] for $400," he recalls. "He seemed he had a good idea and was motivated by the idea."
But that frat member didn't hand over any cash at that time. Meanwhile, some of his brothers started getting returns, and others regretted not investing.
"He was getting great word of mouth," says Dave Litchman, another Sigma Fi brother. "He had shown good faith to people by returning their investment and then people were reinvesting their money."
Litchman says he forked over $10,000 from an inheritance from his grandfather. He also says he convinced members of his family to invest "a great deal more."
Bick's high school classmate, who declined to be named, says he took Bick's business partner, John Wrobel, out on the family's boat, where Wrobel convinced him to put down $6,000. He also says he had a lawyer draw up a contract stipulating the partners would return $7,000 within 40 days. "I had heard from some friends he'd made some good returns," the classmate says. "The contract made me feel secure."
But the only person who stood to reap a posh lifestyle from this scheme was Bick, according to prosecutors. They say the club owner was soon spending the cash on shopping and travel (one foray included admission to Manhattan's Museum of Sex.)
One investor coughed up $50,000, and afterwards Bick bought two jet skis and a trailer, the feds say. "This purchase not only allowed Bick to enjoy the fruits of his crime but also allowed him to present himself as very successful," the indictment reads. Bick's nautically-inclined school friend says he's seen the skis docked on Candlewood Lake.
Eventually, of course, Bick fell behind paying investors.
"I was supposed to get paid one day and then he kept BS-ing me," the anonymous Sigma Pi brother says. "He said he'd run into some complications and would get it to me soon." He says he hounded Bick with texts and emails for about a year.
"It was a gradual thing," according to Litchman. "He just slipped out of the picture. Then he wrote me a check that bounced."
The next the two college students heard of Bick, the feds were calling them to get statements, they say.
It's not clear exactly how Bick landed on prosecutors' radar, but in July 2013, he allegedly lied to a US Postal Inspector (an office tasked with investigating allegations of fraudulent bank activity), claiming that one investor's money had been put into artist deposits for his shows when it hadn't.
The indictment also references a sad incident from May 2014, when the alleged scheme was apparently in its death throes. "When he was hundreds of thousands of dollars in debt," Bick allegedly returned to the "modest home" of an "elderly woman" who had invested "to ask for an additional $10,000, a request for funds she declined as she literally did not have the money."
The garden weed of white-collar crime, Ponzi schemes pop up ceaselessly. Phelps's blog includes a monthly round-up of new ones. She reported an average of seven a month over the last year, and she suspects many never make the news because the victims are too embarrassed to go to authorities.
She says sentencing usually depends on the sum swindled, and Bick's alleged haul of half a million is tiny by Ponzi standards. "A small Ponzi scheme is about $3 million," she says. Still, Bick is charged with 11 counts of wire fraud, each of which carries a potential 20-year sentence, along with three counts of money laundering and one count of making a false statement to federal law enforcement (the Postal Inspector). The trial is ongoing, as the feds work through progression of 64 witnesses, a handful of experts and dozens of alleged investor-victims.
But for Bick, free on bail, there is no reason to put away the turntables and subwoofers. Tuxedo Junction has a schedule of shows, and unlike the high-roller depicted in the US attorney's report, Bick claims he lives humbly with his parents, having yet to make a livable profit from Tuxedo Junction, though he's committed to doing so.
"I am really just focused on Tuxedo Junction right now," Bick says. "My goal now is seeing a thousand kids having the time of their lives."