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Man Gets Prison Term for Defrauding Investors
CEDAR RAPIDS, Iowa (AP) - A Cedar Rapids man was sentenced to more than four years in prison after pleading guilty to defrauding investors of more than $1 million as part of a Ponzi scheme.
The U.S. Attorney's Office says U.S. District Court Judge Linda Reade sentenced 58-year-old Jeffrey J. Kinseth to four years and three months in federal prison, followed by three years of supervised release. Kinseth must pay restitution to his victims of $1.1 million.
Kinseth earlier acknowledged he used his company to solicit money from 11 investors in 2008 and 2009, promising substantial returns.
Instead, he used most of their money to pay back other investors and for other uses, while suffering losses in the investments he did make. To disguise his fraud, he issued phony account statements showing investments were growing.