DENVER — A Denver man was sentenced Thursday to 10 years in prison after defrauding investors out of nearly $20 million in a Ponzi scheme.
Daniel Rudden, 72, was sentenced Thursday to serve 121 months in prison, followed by three years on supervised release for fraud.
According to a news release from the U.S. District Attorney’s Office for the District of Colorado, Rudden was the president and owner of Financial Visions, Inc., a business which paid funeral expenses up front for people who couldn’t afford to, and then accepted payment from the life insurance of the person who had died.
The business charged the family of the person who died a 4%-5% service fee.
Investors in Financial Visions were promised 12% interest per year on the amount they invested. But while Rudden continued to take money from investors, the company’s services didn’t increase, so the company wasn’t making enough money to make payments to the investors.
Rudden started using the new investors’ money to make interest payments to earlier investors. About 175 investors lost nearly $20,000, 65 people lost more than $100,000 each and two people lost more than $1 million.
“This is a scheme that was particularly egregious because the defendant took advantage of people at one of their most emotional times – following the loss of a loved one,” said Jason Dunn, U.S. Attorney, in the release. “The sentence here appropriately reflects that harm.”AlertMe