SACRAMENTO, Calif. — A Sacramento-area man was sentenced to 12 years in federal prison Tuesday for running what prosecutors say was a massive Ponzi scheme that cost investors in six states millions of dollars.
U.S. District Judge John Mendez sentenced Lawrence Leland “Lee” Loomis, 60, of Granite Bay, in the scheme that collapsed during the 2008 Great Recession.
He could have faced 18 years in prison under a plea deal that also calls for him to repay less than $500,000 for defrauding nearly 200 investors in Arizona, California, Colorado, Florida, Illinois and Nevada.
Loomis Wealth Solutions took in more than $10 million by promising 12 percent annual returns, prosecutors said. Instead he used the money for expenses and to pay other investors, authorities said.
When investigators cracked down, they found about $4,300 remaining in investors’ accounts.
“Loomis Wealth Solutions was built on a foundation of lies and deceit,” U.S. Attorney McGregor Scott said in a statement.
Investigators said some investors drained their retirement accounts and lost their homes when the scheme collapsed.
Loomis told Mendez that he never intended to defraud anyone, The Sacramento Bee reported .
San Jose Pastor D. Ronald Bailey, 71, lost a $250,000 investment taken from his home equity.
“I found myself waking up every night in a cold sweat convinced I was going to be bankrupt, homeless and unable to provide for my family,” Bailey said.