The little old ladies, in many cases through investment advisors, invested in a fund that was based on buying up life insurance policies and using the death benefit to guarantee returns of 5% or 7%. Any due diligence they would have done, would NOT have shown he was a crook. Robert then took that money to fund his personal life style and his 'hobbies'. This is what the SEC is coming down on him for, not for pretending to be a pinball company. It is pretty cut and try that he did not do what he was legally required to do. Certainly some of those investment advisors are going to be in trouble for their lack of due diligence and follow up.

Robert clearly thinks he is the smartest guy around, which is obviously laughable. He likely thought, I can do what I want with this money as long as those old ladies get their 5% and pinball is easy, so no big deal. In a year, we will release multiple machines, will be printing money and everyone will be happy.

A few issues --

First and foremost, it is illegal to take that money and use it for something other than what investors were told. Even though he had a 10% 'can do other investments', he obviously went, way, way, way beyond that. Even beyond that, using it for personal expenses is obviously against he law, period, no ifs ands or buts.

Second issue -- pinball is NOT easy and there is long list of failed companies that prove that. It is also clearly way, way harder than he thought, especially given his total lack of knowledge and experience. He clearly had not clue how to build a manufacturing company as he tried to re-invent a world, he did not even understand to the slightest degree.

As far as JPOP, he is a creative flake and an opportunist, who has some kind of a jedi mind trick ability to convince people to see things that are not there. Probably one of the things Robert likes about him, they are kindred sprits in that way. They can can create vision that people want to be a part of, while the whole thing is just vapor. While his is a totally responsible for the zidware fiasco, he is not responsible for this financial fraud. He is in no way smart enough.

Any original zidware person who did not take the money when they had the chance and let it ride, well, hard to understand that. You got burnt, and then through a freaking miracle you had a chance to get your money back and you passed on it? Not sure what you were thinking, but you have no one to blame but the person looking back at your in the mirror and I think they all get and accept that.

Those who jumped in later, the red flags were everywhere, as Robert had yet to deliver on a single promise, commitment, anything what so ever that he ever said, other than refunding zidware folks who wanted it. The cherry on top was asking for trivial about of money on deposits -- why would he go back on the 'never take pre-order', for nickels and dimes? -- that to me was the biggest red flag of all. Getting on the roller coaster ride with him given all of that is just crazy, but seems most had an escape hatch via the credit card, so, I hope they enjoyed the ride and no one got hurt.

Hopefully Robert gets what he truly deserves. While I think the SEC stuff, will not be as bad for him as many think (e.g. probably won't put him in prison), I am sure the IRS, justice department, state attorney generals, the state bar associations, other government agencies and those little old ladies, will be lining up to get their shot at him, and those things will make the SEC stuff seem like a day in the park and will likely land him in prison for a long time.