Can Better Financial Regulation Prevent Investors from Being Defrauded?
New Horizons in Money and Finance series
Chapter 7: Preying on the Amish
The Amish are renowned for their traditional, family and community-based Christian values and austere lifestyle, structured around plain clothes, simple living and rejection of most of the trappings of modern technology, such as the driving of cars and connection to the electrical grid. They form part of the Mennonite Church, members of which migrated from Switzerland to the United States in the early eighteenth century. It is thought that there are 250 000 Amish in the United States, primarily in Ohio, Pennsylvania and Indiana. Hard work, frugality, saving and sharing are core values of the Plain communities. So is trust: Amish are true to their word and expect fellow members to be likewise. Thanks in no small part to the well-publicized book by Lorilee Craker (2011), along with later articles by Justin Kuepper (2012) and Megan Durisin (2013), the Amish have also gained a reputation for financial acumen, with considerable success in business and in managing money (hundreds have accumulated assets in excess of $1 million). That image, however, has been dented by a series of frauds against the communities, two of which came to light in 2011 (SEC, 2013b; US Attorney’s Office, 2012) and another in 2014 (Banbury, 2014). These frauds, it transpires, were not isolated events,1 and some, if not all of them, bear the hallmarks of Ponzi schemes.
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