An investment adviser from Franklin Square was sentenced Wednesday to four ½ years in federal prison for conning his clients out of nearly $2 million in a Ponzi scheme.
Paul Sullivan pleaded guilty to wire fraud in November of 2013 at Central Islip federal court.
“Sullivan abused the trust placed in him by his clients, many of whom considered him a close friend,” said Kelly Currie, acting U.S. Attorney for the Eastern District of New York. “Sullivan then dug a deeper hole for himself and his clients by orchestrating a Ponzi scheme that ensnared even more victims.”
Prosecutors said the 50-year-old man made investments without his clients’ authorization that resulted in significant losses, and when his victims caught on, he promised to repay them if they didn’t alert the authorities.
In order to keep that promise, Sullivan stole funds from other clients, whom he told he was investing their money in special private investments with high rates of return, authorities said.
One of Sullivan’s victims confronted him using a hidden camera and reportedly caught Sullivan admitting to the crime, prosecutors said.
“What I did was completely illegal, completely wrong,” he said on the video, according to investigators. “Everything I’ve done was wrong, was illegal. I have nothing to say.”
U.S. District Judge Leonard D. Wexler also sentenced Sullivan to three years of post-release supervision and ordered him to pay $1.9 million in restitution to his victims.