Donald Anthony Young, an investment adviser who headed Acorn Capital Management LLC, was charged with running a $25 million Ponzi scheme, prosecutors said.
Young, 38, of Palm Beach, Florida, was indicted today on one count of mail fraud and one of money laundering, U.S. Attorney Michael Levy in Philadelphia said in a statement.
"Ponzi schemes are usually a vehicle for an unscrupulous person to live high off of someone else's wealth," Levy said in the statement. "This defendant helped himself to others' fortunes, living a life of luxury, with little or no regard for the damage to our financial markets."
Young operated an investment advisory business in Kennett Square, Pennsylvania, under names including Acorn Capital Management II LP and Acorn Management LLC, according to the statement. He allegedly solicited more than $95 million from investors and diverted more than $25 million to cover the purchase of homes in Pennsylvania, Florida and Maine, according to the indictment.
When clients requested money, Young allegedly paid them with funds from other investors, prosecutors said. He also lied to the U.S. Securities and Exchange Commission and refused to provide the agency with documents in an investigation last year, prosecutors said.
James McHugh, an attorney for Young with the Federal Community Defender Office in Philadelphia, didn't immediately return a phone call seeking comment.
If convicted, Young faces a maximum of 30 years in prison.
The case is U.S. v. Young, U.S. District Court, Eastern District of Pennsylvania (Philadelphia).
To contact the reporter on this story: Sophia Pearson in Wilmington, Delaware, at firstname.lastname@example.org.