Paul Lebo, 41, previously pleaded guilty to a count of wire fraud in a years-long Ponzi scheme, and Tuesday, U.S. District Judge Charles Fleming sentenced Lebo to 48 months in prison.
Lebo was also ordered to pay $635,000 in restitution. He’ll also have a three-year long supervised release.
Court documents showed that between April 2017 and October 2021, Lebo convinced investors his hedge fund, which was non-operational, was legitimate, tempting them with a variety of trade options and promising “future equity ownership.”
Prosecutors said that instead of spending the money as promised, he used it “for personal expenses, bad stock market trades, unsuccessful attempts to acquire real estate, and to repay earlier investors.”
In order to keep investors happy, he’d take money from his parents or new investors or make fraudulent online sales to repay them.