June 5 (Bloomberg) -- An investment adviser was sentenced to four years and three months in prison for defrauding Ball State University of more than $8 million, some of which prosecutors say he spent on cars and beachfront real estate.
Seth Beoku Betts, 38, was sentenced today in Manhattan federal court. The founder of Betts & Gambles LLC persuaded the Muncie, Indiana, school to give him money to invest in collateralized mortgage obligations, directing some of the money to disreputable investment dealers and spending some on himself, the government said.
“He stole a good deal of that money,” U.S. District Judge Shira Scheindlin said as she imposed sentence today. “In short, the money was lost.”
Betts was arrested last year in North Carolina, the U.S. said. He pleaded guilty to one count of securities fraud in February.
Betts approached a former director of investments for the school in 2008 to solicit the money, and engaged in a “four-year saga of delay and deception” when she inquired about the funds, prosecutors alleged in a June 3 court filing. A lawyer for Betts, Deveraux Cannick, told the judge his client has made efforts to recover money lost through the bad investments.
Betts, who was alleged to have spent almost $1.5 million of the university’s money to buy a home in Boynton Beach, Florida, has “lost everything he’s had on this earth,” Cannick said.
The defendant, who grew up in Sierra Leone and England and has been in federal custody for the past year, told the judge he was “completely humiliated.”
“For all intents and purposes, I’m a pauper. I’m destitute. I’m broken,” he said.
A representative of Ball State didn’t immediately respond to a request for comment on the sentence.
At the time of Betts’s arrest, the Betts & Gambles website said the company combined both real estate development and investment opportunities that include waterfront properties in North Carolina and a condominium hotel in the Dominican Republic.
The case is U.S. v. Betts, 13-cr-467, U.S. District Court, Southern District of New York (Manhattan).
To contact the reporter on this story: Christie Smythe in Brooklyn, New York, federal court at
To contact the editors responsible for this story: Michael Hytha at firstname.lastname@example.org Andrew Dunn, Peter Blumberg