An Ohio man will serve six-and-a-half years in prison for fraud, after he allegedly deceived investors in 29 states. The man, who is a member of an Amish church in Ohio, is accused of defrauding investors out of close to $17 million.
Prosecutors claimed the 78-year-old man promised the investors he would use their funds cautiously, but secretly moved that money to more volatile investments. It's unknown what qualifies as "more risky." The man asked that he be allowed to serve his sentence at his Ohio home, but a judge denied that request. The man is likely not a flight risk, so it's unknown why the judge rejected his request. Prosecutors initially sought a prison sentence of 12 years.
It is unclear whether the man profited from the alleged fraud, but prosecutors say he wasted the life savings of hundreds of families. The man's investors, primarily members of Mennonite and Amish communities, initially wished to settle the issue outside of court. However, a judge rejected that request and deemed a court trial necessary. The Amish typically do not settle their disputes in public courts and are largely unacquainted with the U.S. legal system.
The man operated an investment service catering to Amish clients for several years before filing for bankruptcy in 2010. The company listed around $18 million in assets and $33 million in debt at the time of the filing. His investors say he "breached the trust of his fellow Amish and Mennonites" by taking the matter to bankruptcy court rather than resolving it within the community's "environment of trust and mutual aid." But the fact that the community wanted to resolve the issue internally shows that they are willing to forgive, which could help in an appeal.
Source: Bloomberg Businessweek, "Ohio man sentenced in $17M Amish fraud case," June 13, 2012