Michael Goldberg has been sentenced to ten years in prison for a Connecticut Ponzi scheme that took $100 million from unsuspecting investors. He pleaded guilty last year to three counts of wire fraud. The scheme “promised” high returns on investments in diamonds and distressed real estate. According to court documents, the money never made it into the promised investments and was instead was used to pay off previous investors. Goldberg will also need to pay $500 a month in restitution after prison, as ordered by a Hartford judge.
Two victims testified during the case, one of who lost half of her retirement savings in the investment scam. Other victims are said to have lost retirement savings, college savings, and their homes. Some previous investors actually profited in the scheme, but are still being sought by officials. The hope is that millions of dollars can be collected, and that investors who lost money may be able to receive a third of what was lost.
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Goldberg did not live the lavish lifestyle of most Ponzi schemers, keeping only 1 or 2 million dollars over the 12 years he allegedly ran the scheme. He referred to the ordeal as a “runaway nightmare” and apologized to his victims and to his own family. He will undergo a mental health evaluation and substance abuse treatment.
Federal prosecutor David Novick stated with regards to Goldberg that “this was a case of what I consider epic narcissism, epic ego. He needed to feel like he was important. He needed to feel like he was these people’s economic savior.”
Goldberg remains free on bail and is to report to prison on July 18th.
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