A McKinney man who ran a Ponzi scheme that involved more than 100 investors has been sentenced to five years in federal prison.
Patrick O. Howard, 50, pleaded guilty to securities fraud in November and was sentenced Thursday. He must also pay $13 million in restitution to his victims.
According to authorities, Howard promised investors returns of at least 12% annually, with absolutely no risk of losses because of insurance. Those who opted to withdraw their earnings were paid with money from later investors, and those who reinvested were given phony account statements.
In all, 119 investors put more than $13 million in his three fraudulent funds from 2015 to 2017.
Howard, who lied about being a registered investment adviser, used millions of dollars of the investors’ money on personal expenses and unrelated business expenses, authorities alleged.
One victim who testified at this week’s sentencing hearing said that she lost her daughter’s college savings to Howard. Another investor put all of his retirement savings in one of the funds.