Connecticut Man Receives 8-Year Sentence for $6 Million Ponzi Scheme

A Connecticut man was sentenced to serve more than eight years in prison after pleading guilty to operating a Pomzi scheme that duped more than 50 investors out of $6 million.  Gregory Viola, 60, had been arrested in August 2011 and charged with multiple counts of mail fraud.  United States District Judge Vanessa L. Bryant handed down the sentence to Viola and also ordered him to pay nearly $7 million in restitution to his defrauded victims.  Viola's financial status and ability to satisfy the restitution order remains unknown.

According to authorities, Viola provided tax advice for various companies from 1989 to 2006 while also serving as an unregistered investment advisor.  Beginning in 2007, Viola began operating an investment advisory business, purporting to earn lucrative returns for investors.  Viola provided investors with fictitious account statements showing steady returns, with total assets under management approaching $10 million at one point.  

However, Viola failed to achieve the advertised returns, instead operating  the classic Ponzi scheme by using new investor funds to pay returns to existing investors.  In addition to paying out $2.5 million to investors as fictitious returns, Viola misappropriated investor funds to cover his personal expenses, including jewelry purchases, country club memberships and the payment of his mortgage.  

In total, the scheme cost investors more than $6 million.