Couple Sentenced in Ponzi Scheme

A Clifton Park couple plead guilty to charges that they defrauded investors in a "Ponzi Scheme".

By: James R. Lindamood

A couple in Clifton Park were sentenced in Federal Court on Tuesday for defrauding investors. According to officials at the Justice Department, the couple,"unlawfully enriched themselves and fraudulently obtained monies from ... investors by operating a pyramid, or Ponzi scheme." The couple, founders of "unlawfully enriched themselves and fraudulently obtained monies from ... investors by operating a pyramid, or Ponzi scheme." Save-A-Home, LLC defrauded investors out of approximately $1.6 million.

While the couple originally faced sentences of up to 20 years in prison, in the end, the husband, Steven O'Brien received 3 years and 5 months of imprisonment, while his wife, Jeanne, was sentenced to 5 years of probation. They started their company in 1998, and offered guaranteed returns of up to 20 percent with just a 90 day turnaround.

The scheme, which involved buying real estate and leasing or flipping the properties for a profit, was initially a success. They were able to pay off their original investors as promised who, in turn, brought in fresh money. All told, more than 20 people invested with the O'Briens, investing in properties in New York, New Jersey, and Florida. The O'Briens began using money from later investors to pay off those people who invested earlier in the scheme. In 2002, the company had lost over $700,000, but kept entering into new agreements, with some new investors putting in as much as $50,000 of their own money.