Three Ventura County residents convicted of running a Ponzi scheme were sentenced to prison on Monday, May 20, 2013.
A federal judge sentenced three Ventura housemates to prison this week after they were convicted of running a $27 million Ponzi scheme, authorities said.
Alan G. Flesher, 65, who was considered the leader of the scheme, was sentenced to more than 17 years in federal prison. His brother, Wayne D. Flesher, 62, received a six-year sentence. Nancy Carol Khalial, 65, was sentenced to four years in prison.
Between 2001 and 2005, the trio defrauded 790 investors out of cash, telling them they would use the funds to purchase and place Ad Toppers, advertisement-displaying video screens mounted on top of ATMs, vending machines and the like, according to federal prosecutors.
They were able to raise $41 million. Most of the funds never went to pay for the devices. The fraudsters used money from new investors to pay off older investors, prosecutors said.
By the time the Ponzi scheme was discovered, investors across the nation lost a total of $27 million.
They pleaded guilty in July to 17 counts of mail fraud, according to a statement from the U.S. Attorney's office.