⏱ 2 min read
Matthew Melton, a convicted fraudster, ran a Ponzi scheme in New York, promising investors guaranteed returns of up to 12% per month through his ‘Price Physics’ investment vehicle. However, instead of investing the funds as promised, Melton used the money to pay his personal expenses, including mortgage payments and sailing excursions, and to pay earlier investors in a Ponzi-like fashion. The scheme began to unravel on December 15, 2020, when Melton received word of a criminal investigation, prompting him to flee the country. Melton pleaded guilty to securities fraud in April 2026 and was sentenced to 51 months in prison.
Melton’s ‘Price Physics’ investment vehicle purported to invest in futures contracts using a proprietary trading algorithm, but in reality, there was no such algorithm, and Melton invested almost none of the millions of dollars he raised in the manner promised to investors. The few times that Melton did make trades, they were generally unprofitable and not in futures contracts as promised.
The U.S. Attorney’s Office for the Southern District of New York, led by Jay Clayton, has been cracking down on financial fraudsters, with 27 CEOs and corporate leaders charged with fraud in the past 18 months, and 12 individuals charged with insider trading. The office has also doubled the number of insider trading investigations year over year.
Melton’s sentence serves as a warning to those who would engage in similar fraudulent activities, with U.S. Attorney Jay Clayton stating that ‘if you defraud our retail investors, we will bring you to justice.’ The case highlights the importance of vigilance and due diligence in investing, and the need for investors to be cautious of promises of guaranteed high returns.
📋 Key Facts
- Crime: Fraud & Financial Crimes
- Defendant: New York
- Location: NY
- Source: DOJ Press Release
