A Kansas City man will spend eight years in prison for running a Ponzi scheme and defrauding his church.
Matthew R. Peterson pleaded guilty to one count of bank fraud and one count of money laundering in September, the “Kansas City Business Journal” reported. This week, U.S. District Judge Howard Sachs sentenced Peterson to eight years and one month in prison and ordered him to pay $2.516 million in restitution to his victims, according to a release from the U.S. Attorney for the Western District of Missouri.
Peterson held himself out as a sports betting expert, persuading at least 37 victims to invest $6 million in sporting wagers, prosecutors said. He produced phony spreadsheets, financial statements and betting reports purportedly showing that invested money was generating big returns. Instead, he used about $3.3 million in money from new investors to pay early investors what he said were profits on their investments.
Investor money also went to financing a grand lifestyle, prosecutors said. Peterson spent about $565,000 on luxury vacations, personal gambling, cars, a house and more.
Court documents said one investor liquidated his retirement account to invest it with Peterson. In addition to taking the cash in the Ponzi operation, Peterson also used the investor’s personal information to obtain a credit card, racking up nearly $249,000 in charges without the investor’s knowledge. Prosecutors said that investor alone lost about $461,000.
Peterson also approached pastors of his church with a proposition: If they promoted AIS Travel, which he owned, he would donate a portion of profits to the church. Although the pastors didn’t go for that arrangement, they did take him up on his offer to help arrange a staff retreat in Cancun, Mexico. After paying Peterson $16,000, the group got to the airport and found that Peterson had not bought airline tickets or made hotel reservations.
–Dwight Widaman | Metro Voice