- Associated Press - Saturday, June 3, 2017

RAPID CITY, S.D. (AP) - A former Rapid City investment adviser was sentenced to federal prison for allegedly pocketing $4.2 million in clients’ money

The Rapid City Journal (https://bit.ly/2rUfknW ) reported that Mike Lundy pleaded guilty to wire fraud and making and filing a false tax return on May 19. He was sentenced to five years in prison.

The prosecuting attorney said the 68-year-old preyed on some friends and people he knew from church. Authorities said Lundy encouraged more than 80 investors to put money into a fake investment company from the early 2000s to 2014. He then deposited the money in his own account.

“This was just your classic Ponzi scheme,” Assistant U.S. Attorney Ben Patterson said.

Lundy used some of the investors’ money to pay for home remodeling, vacations and a new jeep.

Lundy was a registered investment adviser. He was a commissioned representative of Primerica, a North American financial services firm, and managed its Rapid City office.

The investigation began in 2014 when one of his clients contacted the Rapid City Police Department expressing suspicions about Lundy’s investment product, Patterson said. The IRS and the FBI got involved after the scale of Lundy’s fraudulent activity was discovered.

Chief Judge Jeffrey Viken also ordered Lundy to pay back the $1.3 million he still owes victims and the money he never paid the IRS.


Information from: Rapid City Journal, https://www.rapidcityjournal.com

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