Over the course of about three years, from August 2010 to November 2013, Louis J. Spina collected $18 million from 28 investors by representing that he would invest their funds through his business, LJS Trading LLC, using algorithmic computer software, and that the investors would receive guaranteed monthly rates of return ranging from nine to 14 percent, federal prosecutors in New Jersey assert. According to the government, however, Spina commingled all of the investor funds together in one bank account and transferred only $8 million of the investors’ funds to a trading account – which he then lost in unsuccessful trading.
He allegedly used the remaining $10 million to pay the investors’ monthly interest payments, to return portions of some investors’ principals, and to pay for his own personal expenses, including car purchases/payments, luxury apartment rental payments, and a $400,000 donation to a private university.
Now, Spina has been arrested on a charge that he operated an $18 million Ponzi scheme involving victims from New Jersey. The specific charge – wire fraud – is punishable by a maximum potential penalty of 20 years in prison and a fine of $250,000 or twice the gross gain or loss from the offense.
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