MIAMI (CN) - The SEC today froze the assets of F&S Asset Management Group and the Federal Employee Benefits Group, claiming their late owner, Kenneth Wayne McLeod, soaked federal employees in a $34 million Ponzi scheme, persuading them to invest in a government bond fund that didn't exist.
Most of McLeod's 260 victims were retirees he suckered at "retirement benefits seminars he gave at government agencies nationwide," the SEC said in a statement announcing its federal complaint.
"The security of the government bonds was a key element of McLeod's deception but he never purchased any bonds," the SEC said. "Instead, he used the investors' retirement savings to conduct a Ponzi scheme, to pay himself, and to pay for lavish entertainment, including annual trips to the Super Bowl for himself and 40 friends."
A federal judge today (Friday) froze the two companies' assets and appointed a receiver. A hearing has been set for July 6 in Miami.
F&S still has about $43 under management for 1,147 clients, most of them retired government workers, the SEC said in its complaint. McLeod was 48 when he died, said the SEC, without specifying when or how that happened.
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