STATESVILLE, N.C. — A 73-year-old Mooresville man who promised his mostly elderly investors exorbitant returns on their investments pleaded guilty Thursday to 19 counts of securities fraud and was sentenced to at least nine years and eight months in prison.
"I would like to say I am truly sorry for the money that was lost," Shelby Dean Martin told an Iredell County Superior Court judge before being handcuffed and escorted away by sheriff's deputies. "I understand their hurt."
Martin ran a Ponzi scheme that took in $18.5 million from at least 100 investors from 2004 through 2008, said Dena King, an enforcement attorney with the N.C. Secretary of State's securities division. Martin promised rates of return of up to 50 percent, King said.
In a Ponzi scheme, investors are paid dividends from their own money or from other investors - not from the profits of an investment. The schemes often advertise high returns to attract new investors, and they usually collapse once the flow of money from investors stops.
Martin told most investors he'd use the money to help private companies go public, which would greatly enhance investors' returns, according to a 2009 civil lawsuit filed by the U.S. Securities and Exchange Commission.
Read the full story at CharlotteObserver.com
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