AUSTIN (CN) - A Texan was sentenced to 40 years in federal prison for a $10.6 million Ponzi scheme that ripped off 150 people.
An Arizona woman was sentenced to 6 years for the same scam.
Christopher Brown Cornett, 43, of Buda, Texas, was sentenced to 40 years in federal prison on Friday.
Heidi Beryl, 49, of Scottsdale, was sentenced to 6 years.
U.S. District Judge Sam Sparks also ordered them to pay $9.5 million in restitution, and ordered Cornett to pay an additional $795,000 in restitution.
Cornett pleaded guilty conspiracy in October 2012 to commit wire fraud and conspiracy to commit money laundering in October 2012; Beyer pleaded guilty to wire fraud.
Cornett devised the scam that lasted from April 2008 to October 2011; Breyer joined it in September 2009. The two of them raised more than $14.6 million and half of the money was lost in foreign exchange trading, prosecutors said.
"They used the remaining pool funds for personal enrichment or to make payments to other investors so as to lull those investors into the mistaken belief that their investment was profitable and sound," the U.S. Attorney's Office said in a statement. "Court records reflect that Cornett used pool funds to cover gambling losses in Las Vegas which exceeded $600,000 and to purchase a new Chevrolet Corvette."
The defendants failed to sell their suckers several things, including that Cornett had been convicted in 2003 of five counts of bank fraud, and served 2 years in federal prison.
They also failed to disclose "that Cornett had previously been fired from Morgan Stanley for failure to follow company rules," prosecutors said. "Cornett was terminated from Brookstreet Securities in 2002 because he had violated securities regulations."
In addition, the National Association of Securities Dealer barred Cornett from associating with any member of the NASD in any capacity based on Cornett's theft of $28,000 of an investor's money, prosecutors said.
And that's not all. In February 2012, the U.S. Commodity Futures Trading Commission sued Cornett in Austin Federal Court, accusing him of solicitation fraud, issuing false account statements, misappropriating pool participants' funds and failing to register.
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