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Knotel set to boom and banker steals $100 million with Ponzi scheme

Noun. A decent, upright, mature and responsible person.

Noun, slang. An awkward, clumsy, or unlucky person whose endeavors tend to fail. A loser.

Mensch of the Week:


The co-working company Knotel has struck a deal to create a building that will span between 150,000 and 300,000 square feet in Brooklyn.

The commercial project in the Gowanus neighborhood will be Knotel’s first foray into ground-up development. It expects the project to be complete in 2019.

It seems that Knotel has found its secret sauce to compete with Wework.

“What we figured out early on was that co-working was kind of a clue, but the real opportunity was to run headquarters as a service; let people scale,” said CEO of Knotel Amol Sarva to Cheddar.

Knotel’s growth has been ambitious. The company started the year managing 100, 000 square feet and expect to have 700,000 by the years end according to Sarva. Next year, Sarva expects the company to manage several millions.

Schlemiel of the Week:

Fabien Gagilo

Fabien Gagilo’s has confessed to stealing $100 million dollars from his clients through a Ponzi scheme.

As one of two principals at a Swiss wealth manager Hottinger & Partners, Gaglio would reportedly take money from one client to pay the another. He then graduated to forging signatures and fabricating statements, according to the Bloomberg story on Gaglio’s 15 year charade.

After confessing to his crimes in 2013, Luxembourg courts were the quickest to react and he was charged with making and using forged bank documents, fraud, and laundering stolen funds.

The courts ordered Gaglio to pay back €150,000 ($177,000) and sentenced him to five years in prison.  He spent a year in jail before appealing and having his sentence reduced to four years. In Luxembourg half of a prison sentence is spent on parole. Gaglio’s sentence pales in comparison to Ponzi scheme artists like Bernie Madoff’s 150 years and Robert Allen Stanford’s 110.

Gaglio’s actions caused the parent company of his firm, Hottinger & Cie, to file for bankruptcy. Cost couples $20 million and individuals as much as $12 million. The sum of all the clients he’s swindled, $100 million. Time served behind bars a year with possibly one more on the horizon.

Tilman Reissfelder, who lost that $12 million and spent another $1 million investigating Gagilio, did the math on whether the punishment fit the crime. He found the results lacking.

“If there are no consequences, then the world is seriously broken,” Reissfelder told Bloomberg.

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