Saturday, 22 October 2016
Last updated 1 day ago
May 23 2012 | 11:46am ET
A 65-year-old California man will spend the first of his golden years behind bars after pleading guilty to a hedge fund Ponzi scheme.
John Clement of Encinitas was sentenced to two years in prison yesterday. Clement pleaded guilty in September to ripping a dozen investors in his Edgefund Capital "hedge fund" off to the tune of $4.9 million.
According to prosecutors, Clement told investors that Edgefund offered returns of 1.5% to 2% every month with little or no risk. He then sent his victims phony account statements to back up his claims.
In addition to Ponzi scheme payments, Clement spent about $300,000 of the money he raised on personal expenses.
U.S. District Court Judge Irma Gonzalez also ordered the Encinitas man to pay $4.9 million in restitution and three years of supervised release. But she doubted he'd be able to make good on the former.
"I don't think you'll ever be able to make up $4.9 million, in this economy, at your age," she said.
While Clement told Gonzalez that he does "regret every single thing" he did, his attorney blamed what he called his client's aggressive form of brain cancer for his behavior. And while Charles Rees said the cancer was in remission, there is still an "excellent chance" that Clement would die in prison.