A California man is facing federal fraud charges for allegedly defrauding a former Indianapolis Colts player out of over $4.5 million. Kenneth Ray Cleveland, 63, of Agoura Hills, California, has been indicted on seven counts of wire fraud and three counts of money laundering.
According to the indictment, Cleveland worked as the victim’s financial advisor for years, starting just after the victim entered the NFL after college. Cleveland allegedly promised to invest his money in conservative investments that would yield a significant amount of “interest” every month without ever depleting the principal.
Over nearly 10 years, the victim provided millions of dollars to Cleveland to invest on his behalf. Instead of investing the money, however, Cleveland allegedly spent it. According to the indictment, he used over $2 million as part of a Ponzi scheme to pay fictitious investment returns to his other clients.
Cleveland also spent over $2 million more on personal expenses, such as his home mortgage, credit card bills, and payments to family members. Throughout the alleged scheme, Cleveland repeatedly reassured the victim, both in writing and in person, that his investments were safe and performing well.
The indictment alleges that Cleveland routinely provided the victim with false information regarding his purported “investments,” including fictitious financial statements. Cleveland also allegedly paid the victim “interest” using the victim’s own money in an effort to continue to gain the victim’s trust and his money.
United States Attorney Josh Minkler announced the indictment, stating that “People place great trust in those who help manage and invest their hard-earned money. Exploiting that trust for personal gain through lies and deception is a crime that this office takes very seriously.” The case was investigated by the Federal Bureau of Investigation, and Assistant United States Attorney Nick Linder is prosecuting the case for the government.
The charges against Cleveland carry maximum sentences of between 10 and 20 years in prison and a maximum fine of $250,000. An indictment is only a charge and not evidence of guilt. All defendants are presumed innocent until proven otherwise in federal court.
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Key Facts
- State: Indiana
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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