BREAKING NEWS

Former New York broker gets 9 years prison for Ponzi scheme

By REUTERS

FEBRUARY 25, 2016 00:55

A former broker at a New York investment firm was sentenced to nine years in prison on Wednesday after being convicted of helping to run a Ponzi scheme that bilked around 3,800 investors out of more than $150 million.

Jason Keryc, formerly of Hauppauge-based Agape World Inc, was sentenced by U.S. District Judge Denis Hurley in Central Islip, New York, and ordered to pay $179 million of restitution, U.S. Attorney Robert Capers said.

Keryc's sentencing came after a federal jury in April found him and another ex-employee, Diane Kaylor, guilty on charges including securities fraud, conspiracy, mail fraud, and wire fraud.

Prosecutors said the two played critical roles in defrauding unwitting investors in a classic Ponzi scheme at Agape, which was founded in 2000 by Nicholas Cosmo after he served 21 months in prison for defrauding investors.

Lasting from October 2005 to January 2009, the scheme at Agape pulled in more than $370 million by promising unrealistic returns on investors' money, prosecutors said.

In typical Ponzi fashion, some returns to investors were paid, not from any profits earned on investments, but from existing investors' deposits or money paid by new investors.

Prosecutors said Keryc spent some of the $8.9 million he made off the scheme on a million-dollar vacation home in Montauk, a condominium in Long Beach, automobiles, jewelry and designer clothing.

A lawyer for Keryc did not immediately respond to requests for comment.

Cosmo was sentenced to 25 years in prison in 2011 after pleading guilty over the scheme. Six other people besides Cosmo, Keryc and Kaylor have also been convicted.

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