| Jacksonville Man Sentenced to Ten Years in Prison for Operating Ponzi Scheme under the Guise of a Foreign Currency “Hedge Fund”
Defendant Defrauded Investors of more than $23 Million in less than Five Years ATLANTA—Manyu Ogale, 44, of Jacksonville, Florida, was sentenced today by U.S. District Judge Richard W. Story to 10 years in prison on a federal charge of mail fraud arising out of a so-called “Ponzi” scheme that defrauded investors out of more than $23 million, announced David E. Nahmias, the U.S. Attorney for the Northern District of Georgia. Nahmias said of the case, “We continue to uncover a distressing number of multi-million dollar Ponzi schemes. In this case, the con-man raised more than $23 million from his victims in less than five years by posing as a legitimate investment advisor who guaranteed 50% annual returns through a complex foreign-currency hedge fund. These fraudulent investment schemes come in many guises but seem to have one thing in common - the ‘guaranteed’ returns sound too good to be true. Anyone offered such returns should invest their hard-earned money with great caution.” FBI Atlanta Special Agent in Charge Greg Jones said, “This investigation serves as a warning to those who devise schemes to defraud and steal money from hard-working citizens under the false pretense of legitimate investments. It should also serve to warn the American public to be vigilant and to do their homework before investing money with anyone. Investment fraud is a high priority for the FBI, but many of these cases can be prevented if people would simply ask some hard questions before handing their money over to these thieves.” In addition to the 10-year prison term, Ogale was sentenced to three years of supervised release following his incarceration, and was ordered to pay $12,744,349.50 in restitution. Ogale pleaded guilty to the charge on Dec. 18, 2008. According to Nahmias and information presented in court: from January 2003 through May 2007, Ogale owned and operated “Den Haag Capital, LLC,” which he represented to be “a private hedge fund” for “sophisticated investors.” Ogale falsely represented to investors that he had created an algorithm that allowed him to determine whether various foreign currencies were undervalued or overvalued, and he promised to invest his clients’ money in the foreign currency markets using the algorithm that he had created. Ogale guaranteed investors an annual rate of return of 50%. In less than five years, Ogale took in over $23 million from investors. Ogale sent monthly statements to investors, falsely claiming that their investments had substantially increased in value, and Ogale used some of the money that he received from later investors to pay substantial returns to some of the early investors. Ogale never invested any of the money, however, and instead used much of it to pay his own personal expenses in an effort to create an aura of legitimacy for himself. As part of those expenses, he leased and traveled by private jets and leased a luxury Mercedes automobile, as well as paid American Express bills totaling over $1 million. This case was investigated by Special Agents of the FBI. Assistant U.S. Attorney Russell Phillips prosecuted the case. |