Three men are facing a series of charges over a $364 million investment scheme that was to fund luxury cars, jewelry and $25 million worth of casino gambling.
A federal indictment states that Kevin Merrill of Towson, 53, along with Jay Ledford, 54, and Cameron Jezierski, 28, willingly devised a scheme to defraud investors of more than $364 million from January 2013 to the present day.
The indictment alleges that Merrill and Ledford, of Texas and Las Vegas, invited people to buy consumer debt portfolios and falsely represented that they'd profit from debt payments and flipping portfolios.
US Attorney Robert Hur announced at a news conference in downtown Baltimore that the men were arrested and charged with conspiracy, wire fraud, identity theft and money laundering.
Jay Ledford (left) and Cameron Jezierski (right) face charges over the alleged fraudulent scam
The properties (pictured) were purchased through the proceeds of the alleged Ponzi scheme
The alleged scheme is thought to have entrapped more than 400 victims nationwide.
'Most of these investors are just learning that they have been victimized', said Hur, alongside officials from the FBI and the US Securities and Exchange Commission.
‘These particular defendants took steps like setting up shell companies and setting up bank accounts for those companies, fabricating debt reports and sales agreements', Hur said at the conference broadcast by CBS Baltimore.
'Lies (were) being told to prospective investors about almost every conceivable aspect of this scheme.'
Merrill and Ledford spent tens of millions of dollars on luxury cars, jewelry, houses, boats, private jets and gambling at casinos, according to the indictment.
The 14-count indictment alleges that the defendants enticed victims by showing them they could make money through the purchase and sale of consumer debt owed on car and student loans and credit cards.
Prosecutors assert the 'proceeds' paid out came from other investors, not collections or sales, as represented.
The men created impostor companies and incorporated them in Texas, authorities said.
Authorities said the three suspects concealed their diversion of $73 million, which they used to fund a 'lavish