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Jeffrey Folkert Spents Ponzi Scheme Profits to Gamble online
Thursday, October 25, 2012 : MICHIGAN MAN SPENT PONZI SCHEME PROCEEDS ON ONLINE GAMBLING
Convicted fraudster ordered to repay $1,313,787.
A Grand Rapids, Michigan man who spent investors money on Internet gambling and personal expenses has been sentenced to four years in federal prison after being convicted of operating a $1.5 million Ponzi scheme.
Jeffrey Curtis Folkert (42) was convicted and sentenced by U.S. District Judge Robert Jonker Wednesday, who in addition ordered that the defendant pay restitution of $1,313,787.
Folkert pleaded guilty to mail fraud, and was remanded to the custody of U.S. Marshals after U.S. Attorney Christopher O’Connor claimed he had violated the conditions of his bond, and that there was probably cause to believe defendant had committed a federal crime while on bond.
The court heard that Folkert created iStorm Solutions LLC, a computer consulting business in 2005, and began recruiting investors, telling them they could earn money from Google Inc. when Internet users clicked on their advertisements. But very little of the funds went into Google, and very little revenue was earned.
Folkert provided monthly earnings statements, but would use one investor’s money to pay ‘dividends’ to another investor.
"Additionally, he spent large sums of investor money on personal expenses and online gambling,” Folkert's attorney said.
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