MANHATTAN (CN) - The founder and president of Westgate Capital Management, a New York investment firm, is charged with running a $150 million Ponzi scheme. Federal prosecutors said James Nicholson, 42, has been duping investors since 2004.
According to the indictment, Nicholson promised 8% returns within a month, but used customers' money to pay earlier investors - the hallmark of a Ponzi scheme; he produced phony financial statement to show Westgate Capital had $600 million to $900 million under management, though it had substantially less, and he created false capital account statements to show positive returns.
Prosecutors also say that to mislead investors, Nicholson impersonated the independent accountant who purportedly audited Westgate. Beginning in December 2008, several investors who sought to redeem their investments, had the checks returned for insufficient funds.
If convicted of all four felony counts, Nicholson faces up to 65 years in prison. He has been in federal custody in Brooklyn since his arrest.
Prosecutors seek to recover $150 million, five pieces of property, his fractional share in a Gulfstream jet, his memberships to several Palm Beach country clubs and his personal seat license for New York Jets football tickets.
Westgate Capital Management operates out of New York City and Pearl River, N.Y.
Subscribe to Closing Arguments
Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.
Additional Reads
-
Alaska, Hawaiian Airlines April 17, 2024 -
-
Contributor-Test-Post-2024-04-12 April 12, 2024 -
