U.S. District Judge Paul S. Diamond has publicly disagreed with the policy the Securities and Exchange Commission take toward benefactors of Ponzi schemes. “The SEC and CFTC have apparently adopted a nationwide policy that there can be no recovery of principal from winning Ponzi scheme investors even when the investors should have seen ‘red flags’ alerting them to the true nature of their ‘investments,'” Diamond wrote in his December 15 opinion in SEC v. Forte.