Surrey, BC Ponzi schemer gets jail time
Roberto Castano sentenced 27 months in prison for fraud
A Surrey man who bilked investors through a Ponzi scheme has been handed a 27-month prison sentence for fraud, according to the BC Securities Commission (BCSC).
Roberto Castano was handed the sentence for milking eight investors in a Ponzi scheme in which he issued promissory notes, claiming their money would be invested in stocks. He promised them a 5 per cent return every month on their investments.
The BCSC began investigating Castano in 2009, after receiving a tip from a financial institution.
Castano was raising money from investors through a company called Skyline Communications, according to the BCSC, and investing it in the stock market through a brokerage account.
The investigation revealed that he was using some of the money he raised from later investors to pay earlier ones, and pocketed some of the money himself, which is typically how a Ponzi scheme works.
The investigation led to charges being laid in 2012. In addition to the 27-month sentence, Castano was ordered to repay seven investors C$1.5 million (US$1.17 million).
Victims of Ponzi schemes typically never get their money back, even when there is a court order, because by the time the fraudsters are caught, they are insolvent.