NEW ORLEANS -- U.S. Attorney Jim Letten said a federal grand jury indicted a man on 64 charges for allegedly running a Ponzi scheme of fraudulent investments from the past several years.
"He obtained roughly -- and it is actually over -- but roughly $19.5 million from approximately 160 investors, and spent nearly just about all the money," Letten said.
Matthew Pizzolato, a 26-year-old Tickfaw resident, is charged with operating 20 companies and offering customers investments that were described as "guaranteed," with higher than normal profits. But prosecutors charge Pizzolato never made the investments he promised, instead using their money to buy luxury items ranging from a house in Ponchatoula to cruise ship tickets.
"He is charged with having purchased hundreds of thousands of dollars worth of luxury cars, including a BMW 750 LI, a Mercedes Benz S430V," Letten said.
But the indictment says most of the victims in the alleged scheme were senior citizens, some investing their life savings.
The U.S. attorney said FBI agents and IRS agents arrested Matthew Pizzolato within an hour of the time this indictment was issued. Now prosecutors say they will attempt to make sure he does not get out of jail on bond.
"He had a Covington office, a Hammond office, a Baton Rouge office, and then we know with some of our dealings with the victims that Mr. Pizzolato and some of his sales staff would travel across the Causeway and operate out of operations on Causeway Boulevard in Metairie as well," said Assistant US Attorney Brian Klebba.
"Investments of $100,000, another $100,000, $285,000," Letten said, reading from the indictment amounts investors said they had lost.
The investigation started in 2007 when the state office of Financial Institutions became interested.
"We were getting calls from investors, and I can't talk about the particulars of the case, but things just didn't sound right, and the more questions we asked, the more things didn't sound right," said Rhonda Reeves of the State Office of Financial Institutions.
"The indictment also charges he committed the crime of witness tampering when he allegedly offered hios former employee a $20,000 payoff to destroy records," Letten added.
Reeves warned about offers that seem to be no-brainer deals, and to be wary of those with extraordinarily high predicted rates of returns.
"If something sounds too good to be true, it probably is," Reeves said.
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