Pennsylvania Ponzi Schemer Cops A Plea

Mar 17 2010 | 1:24pm ET

A Pennsylvania man admitted yesterday that his hedge fund was actually a $12 million Ponzi scheme.

Stephen Alexander pleaded guilty to wire fraud and money laundering. The Villanova man faces up to eight years in prison under a plea agreement when he is sentenced in June.

According to prosecutors, Alexander spent investor money on himself. Clients of his Hartford Investment were treated to phony financial statements touting impressive returns of between 17% and 38%, when, in fact, the investments he made actually lost money.

Alexander allegedly solicited the money from 15 friends and family members. He still owes investors about $7.5 million, He is now free on $50,000 bond.

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