A man who was indicted in South Carolina and Tennessee for a Ponzi scheme has been sentenced to 24 years and four months in federal prison, and ordered to pay in restitution over $18 million.
Luis Hiram Rivas, age 56, pleaded guilty to wire fraud, bankruptcy fraud, and money laundering involving a Ponzi scheme between March 2007 and May 2008. Rivas operated offices, called trading centers, in Knoxville, Tennessee, Spartanburg, South Carolina, Panama City, Florida, and Tulsa, Oklahoma.
He successfully defrauded hundreds of individuals by saying he was an experienced and successful foreign currency trader, guaranteeing investors up to 96% annual return for three years, paid monthly on investments. Much of the investors’ money was never invested, but instead used to purchase luxury items for Rivas’ girlfriends which included houses, cars, furs, jewelry, limousine service, clothing and furnishings.
In addition to admitting to the Ponzi scheme, Rivas also pleaded guilty to bankruptcy fraud. When investors attempted to force Rivas into bankruptcy proceeding in 2008 in order to freeze his accounts, Rivas illegally moved funds to hide them from the U.S. Trustee.