Saturday, November 7, 2009

Ponzi Schemer John M. Donnelly Sentenced To 7+ Years, $5.3 Million Restitution

Confessed Ponzi schemer John M. Donnelly was sentenced on November 6 to 7 1/2 years in Federal prison and ordered to pay restitution of more than $5.3 Million.  He is currently being monitored by GPS, out on $100K bond, and must report to prison in six weeks.

During sentencing, one victim noted Donnelly lived a luxurious lifestyle. Donnelly's house is a 5 bedroom, 4.5 bath, 3,000 sq. ft. house on 3.4 acres on Church Plains Road in Crozet's Church Hill subdivision.  The house was purchased in 2003 for $440K; it is currently assessed for $597,700 (pictured, to left, from County records).

Wife Deborah Donnelly is the Executive Director of UVA's Curry School of Education Foundation, which is responsible for garnering charitable donations.  The house, which is titled jointly in both names, was purchased after the alleged Ponzi scheme began.  While Deborah Donnelly was initially named a "relief defendant," she has not been charged with any wrongdoing.

Additional assets include a Hummer, 64 acres in Fluvanna, and multiple motorcycles—all of which have or will be liquidated to help repay victims, according to Courteney Stuart for The Hook.

The judge was excoriating during sentence.  Again, from The Hook:

Judge Norman K. Moon expressed disgust for the crime that bilked 30 of John M. Donnelly’s friends and motorcycle racing teammates of more than $5 million.
“This defendant knew these victims were making life decisions,” said Moon, who referred to Donnelly as “evil” at one point and scoffed when defense attorney John Davidson suggested Donnelly was sorry for the pain he’d caused
“If they hadn’t caught you, you’d be doing it still today,” he said.

Related Reading: 
The DP's coverage of sentencing

Wife, UVA Fundraiser Deborah Donelly, Charged as "Relief Defendant" 
Madoff Lite: Feds Claim Charlottesville Ponzi Scheme by Lindsey Barnes, The Hook
SEC Press Release
SEC Complaint Against John M. Donnelly
US Commodities Futures Trading Commission Press Release
SEC Press Releases

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