CHARLOTTESVILLE -- The Securities and Exchange Commission has charged a Charlottesville resident with operating a multi-million dollar Ponzi scheme.
John M. Donnelly and his three companies -- Tower Analysis Inc., Nasco Tang Corp. and Nadia Capital Corp. -- face charges of violating federal securities and exchange acts.
According to the SEC, Donnelly fraudulently obtained at least $11 million from as many as 31 investors via the sale of securities in the form of limited partnerships in his three investment funds.
The SEC found that Donnelly told investors he had a history of generating annual returns of up to 22 percent. Yet he had done almost no securities trading and none since 2002, according to the SEC.
The SEC's complaint alleges that Donnelly used the investors' money to pay other investors and to pay himself $1 million in salary and fees over the past three years.
The U.S. District Court for the Western District of Virginia has entered an order to freeze all assets under the control of Donnelly and his firms.
Donnelly could not immediately be reached for comment this afternoon. -- Media General News Service
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