Investment adviser facing jail over Ponzi scheme swindling clients including Catholic priests group out of $94M

A Florida man has pleaded guilty to charges stemming from a years-long Ponzi scheme that defrauded international investors out of more than $94 million, prosecutors said.

Andrew Hamilton Jacobus, a 64-year-old from Fort Lauderdale, pleaded guilty to wire fraud and money laundering charges on November 14, according to the U.S. Attorney’s Office, Southern District of Florida. Jacobus carried out the scheme between 2004 and 2023, prosecutors said.

Prosecutors said Jacobus targeted several clients — primarily Venezuelan nationals — with his “Ponzi scheme,” including a nonprofit dedicated to supporting Venezuelan Catholic priests’ retirement and healthcare, according to court documents reviewed by the Miami Herald.

A “Ponzi scheme” is a type of scam orchestrated by a fraudster who approaches investors and promises high rates of return. The scammer then pays the original investors with funds from new investors, giving the impression their investments have shot up in value, according to the Cornell Legal Information Institute. The fraudster pays earlier investors with funds from later investors until the scheme inevitably collapses.

The scheme takes its name from the con artist Charles Ponzi, who defrauded thousands of investors in the 1920s.

Jacobus “falsely portrayed himself as a seasoned financial advisor managing legitimate investment portfolios,” and misappropriated investor funds for “personal use and to pay returns to earlier investors in classic Ponzi-scheme fashion,” the U.S. Attorney’s Office said.

The 64-year-old also “forged account statements, falsified documentation, and diverted client funds to luxury personal expenditures and Ponzi payments,” according to prosecutors.

A factual statement — which was filed in court and signed by Jacobus, his attorney and a prosecutor — describes the 64-year-old’s mismanagement of investors’ funds, according to the Miami Herald.

“To conceal his fraud, Jacobus would create and provide to the victims fictitious account statements or balances purporting to show the investment portfolio and related balances, when in fact the victims’ accounts had significantly smaller balances,” the statement reads.

In one example, a Venezuelan investor moved $1 million into a bank account in 2020 “based on the defendant’s false representations that the money would be used for investment purposes,” according to a court document reviewed by the Miami Herald. But instead of investing it, Jacobus moved $120,000 from the account to pay other investors as part of the Ponzi scheme, according to the filing.

Jacobus has also been sued in civil court and has been sanctioned by the Securities and Exchange Commission, the Miami Herald reports. He was initially arrested in July, according to the Internal Revenue Service.

Jacobus faces up to 20 years in federal prison for each count, prosecutors said. He must also repay his victims and help investigators track down the stolen funds, according to the Miami Herald.

His attorney, Bruce Lehr, declined to comment when contacted via phone by The Independent on Friday. The Independent has contacted the U.S. Attorney’s Office, Southern District of Florida for comment.