Clayton man pleads guilty in Ponzi scheme
Posted October 24, 2011 4:13 p.m. EDT
Updated October 24, 2011 4:33 p.m. EDT
Charlotte, N.C. — A Clayton man pleaded guilty Monday to taking part in a Ponzi scheme that cost investors about $40 million, authorities said.
Bryan Keith Coats, 51, pleaded guilty to conspiracy to commit commodities, securities and wire fraud and promotional money laundering conspiracy. He will be sentenced later, when he faces up to 15 years in prison and up to a $500,000 fine.
Coats and several others told investors that they managed a hedge fund called Black Diamond and got people to invest between October 2007 and December 2009 by using phony analytical tools and promises of great returns, prosecutors said. As the scheme began to collapse in 2009, they created cash accounts to pay out older investors and support their own lifestyles, prosecutors said.
Six other people have already pleaded guilty in the scheme.