Jason Konior, Ponzi Scheme, New York 2013

Grimy Times has learned that Jason Konior, the founder and manager of a number of related business entities in New York City, collectively referred to as ‘Absolute,’ has been sentenced to 46 months in prison for his participation in a $2.9 million Ponzi scheme.

According to the U.S. Attorney for the Southern District of New York, Preet Bharara, Konior previously pled guilty on July 9, 2013, to one count of wire fraud for his role in stealing at least $2.9 million from small hedge fund investors and using the funds to pay off prior investors and to pay himself.

Konior, 40, of New York, New York, was sentenced yesterday by U.S. District Judge Alvin K. Hellerstein to three years of supervised release. In addition to the prison term, Konior was also ordered to forfeit $2.9 million and to pay a $2.9 million fine.

The scheme, which was organized and managed by Konior from late 2011 through May 2012, involved misappropriating at least $2.9 million in funds he had solicited from hedge fund investors. Konior represented to these hedge funds that Absolute would provide additional trading funds of up to nine times the investment they made in Absolute.

However, instead of establishing brokerage accounts for the victim hedge funds, Konior misappropriated the funds they provided by paying redemptions to prior investors, making payments to himself, and paying various personal and business expenses.

Bharara praised the work of the Federal Bureau of Investigation and the Securities and Exchange Commission in bringing Konior to justice. The case is part of efforts underway by President Obama’s Financial Fraud Enforcement Task Force, which was created in November 2009 to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.

Konior’s sentence is a significant blow to those who would seek to profit from the misery of others through Ponzi schemes. The U.S. Attorney’s Office for the Southern District of New York will continue to work tirelessly to protect the public from such scams.

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