A West Covina, Calif., man was sentenced to 135 months in federal prison for running an investment fraud scheme that took in almost $4 million from more than 100 victims who were lured to the scheme with promises of "guaranteedâ€ annual interest rates up to 120 percent.
Ruben Gonzalez, 34, a Mexican national, was sentenced Tuesday by United States District Judge Percy Anderson. In addition to the 11-year prison sentence, Judge Anderson ordered $2,220,771 in restitution to his 107 victims.
Gonzalez was arrested on October 23, 2009, on immigration charges after special agents from the Federal Bureau of Investigation executed a search warrant at his business, New Golden Investments Group, or NGI Group, in West Covina.
Gonzalez was indicted in May, and on September 17 he pled guilty to one count of mail fraud, one count of money laundering, and one count of misuse of a Social Security number.
Gonzalez admitted that he advertised his investment program in Spanish language newspapers and on radio stations, guaranteeing returns up to 120 percent per year. Gonzalez told victims that their money would be used to invest in commodities like gold and silver, real estate developments, and a gold mine in Mexico.
Gonzalez further admitted that most of the investors' money was used to make Ponzi payments to lure additional investors, and that Gonzalez took well over $400,000 for his own personal benefit.
At Gonzalez's sentencing, Judge Anderson heard from several victims of the Ponzi scheme, including the mother of a disabled child who was defrauded out of nearly $300,000 that came from a medical malpractice award and was supposed to be used for the future care of her child.
The victim said that Gonzalez claimed she would make enough money from the investment to pay for "the best medical care in the worldâ€ for her child and that she would one day see her child walk as a result of the profits she would make from her investment.
The court also heard from an 81-year-old widow who lost more than $40,000 and who told Judge Anderson that she is forced to continue to work as a result of the losses caused by Gonzalez.