From Chelsea Phua:
A 45-year-old Folsom man who defrauded investors in a $13 million Ponzi scheme was sentenced Tuesday to nearly 20 years in prison, authorities said.
U.S. Attorney Lawrence Brown said in a news release that Stefan A. Wilson, who is also known as Stephen K. Wilson, wiped out retirees' life savings and depleted money meant for college funds and inheritances by bilking about 80 victims and their families between February 2006 and February 2008.
U.S. District Court Judge Lawrence K. Karlton also sentenced Wilson to three years of supervised release and ordered him to pay more than $12 million in restitution.
Prosecutors said Wilson tricked investors by promising an 18 to 24 percent return for investing in the "Christians in Crisis" Investment Fund and required investors to produce a minimum of $100,000.
Of the $13 million he collected, Wilson placed about $6.5 million into a brokerage account to buy and sell stock, but lost nearly all the money, leaving only $30,000 in the account. However, prosecutors said Wilson continued to tell investors the fund was doing well and sent monthly statements and checks to show them that they were receiving the promised return.
Wilson used slightly more than $2 million to pay some investors, assuring them that the money was earnings on their investments. He used the rest to pay for a lavish lifestyle that included a $400,000 down payment on his Folsom home, a $118,000 down payment on a Lamborghini and a $90,000 down payment on a boat. Authorities said he failed to report this income on his 2006 tax return.
Wilson also changed his name from Stephen K. Wilson to Stefan A. Wilson before embarking on this scheme to conceal from investors that he had a 2002 fraud conviction and a 2005 bankruptcy, authorities said.
On March 17, Wilson pleaded guilty to wire fraud and filing a false income tax return.
At his sentencing, victims spoke about the financial devastation that Wilson's crime caused. One family said they lost a farm that had been in the family for 60 years and was paid off until Wilson convinced them to refinance it and another victim said Wilson took money from his son, a disabled war veteran.
They also said Wilson, a former youth minister, lied to them about donating 10 percent of his profits to Christian charities and they trusted him because of his affiliation with the church.
"The defendant's conduct was beyond reprehensible," Brown said. "He manipulated innocent investors and destroyed lives."
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