Three men accused of a Ponzi scheme estimated at $ 364 million in Maryland

Maryland federal authorities charged three men with a $ 364 million Ponzi scheme for more than five years.

Kevin Merrill, Jay Ledford and Cameron Jezierski were arrested Tuesday and charged with using 30 companies and more than 55 bank accounts with hundreds of investors.

"The defendants have attracted investors through a complex network of lies, pushing them to pay millions of dollars into this operation," said US District Attorney Robert K. Hur of Maryland District.

Merrill, Ledford and Jezierski convinced investors to join them in buying consumer debt portfolios – delinquent pledges to banks and credit cards, student lenders and vehicle financiers

Business partners told investors that they would make money by selling their debt to a third party acquiring debt. Instead, prosecutors say, men have used about $ 73 million worth of money to support lavish lifestyles. They spent investor funds in upscale homes in Maryland, Texas, Nevada and Florida, luxury cars, boats and jewelry, even buying a portion of a jet plane and playing $ 25 million in casinos.

According to the prosecutors, the trio lied to the investors to know who they were buying the debt portfolios and how much they were paying. In their communications with investors, they also said they were investing their own funds and exaggerating their track record of success.

Jezierski, who would have played a less important role, incurs a maximum sentence of 20 years in prison. Merrill and Ledford are each facing multiple 20-year sentences for electronic fraud, money laundering and an additional two-year term for identity theft. In recent years, people convicted of Ponzi schemes have been sentenced to long sentences.

The indictment covers the confiscation of nine properties, 26 luxury cars, a boat, participation in the purchased aircraft, a life insurance policy and several diamond jewelery, all purchased with the proceeds of the scheme.

The men are also being sued by the Securities and Exchange Commission. The SEC stated in its file that the victims of the Ponzi scheme include small business owners, construction contractors, retirees, doctors, lawyers, accountants, bankers, talent agents, professional athletes and financial advisors.

"Most of these investors only learn that they have been victimized," said Hur, the US attorney. "The effects of this type of fraud can be devastating and we invite anyone who thinks they are a victim to contact the FBI at [email protected]."