OAKLAND, Calif. (BCN) _ A Danville man has been sentenced to 15 years in prison for defrauding 500 investors of $62 million.
In court papers, prosecutors said 38-year-old Peter Son and a business partner “created the classic Ponzi scheme, paying off early investors when needed while continuing to generate income through false advertising.”
Assistant U.S. Attorney Stephen Corrigan wrote in a sentencing memorandum that the fraud had a devastating effect on the victims.
“Victims report they have lost their life savings, college savings for their children and retirement savings. Victims have had to file for bankruptcy and others have had to return to work,” Corrigan wrote.
Son was also ordered to pay restitution in an amount to be determined later. He and his partner, 46-year-old Jin Chung of Los Altos promised investors returns of 24 to 36 percent per year in foreign currency trading.
Prosecutors said the two men’s companies, SNC Asset Management Inc. and SNC Investments Inc., with headquarters in Pleasanton, took in $85 million from 500 investors between 2003 and 2008.
About $23 million was paid back to investors who either closed their accounts or declined to reinvest the supposed returns, leaving a total loss of $62 million for investors.
The U.S. Securities and Exchange Commission filed a civil fraud lawsuit against Son, Chung and the two companies in federal court in San Francisco last year. SEC Regional Director Marc Fagel said that lawsuit is ongoing.