SANTA ANA, CALIF. (CN) - The CEO of Giant Golf Co. admitted he defrauded hundreds of investors of $28.4 million for shares in a nonexistent Internet company. Colin Nathanson, 59, also was president of Play Big Enterprises - he sold golf clubs and accessories out of Irvine and Santa Margarita.
Nathanson pleaded guilty to six federal charges and faces up to 120 years in prison at his Feb. 9 sentencing, prosecutors said.
When asked if the nationwide problem of securities fraud is due to lack of regulation, Nathanson's prosecutor said, "No, it's a result of pure greed."
Nathanson induced investors to put money into a fictitious Internet business that he claimed was on the verge of conducting an IPO. He spent the money on extravagances, including three homes, $346,500 in gambling debts, and to support his golf companies' unprofitable ventures.
Some of Nathanson's employees and investors became suspicious and contacted the Security and Exchange Commission. It is the third time since 1994 that Nathanson has come to the attention of the SEC. He simply changed the names of his businesses to keep defrauding investors, prosecutors said.
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