A hedge fund manager from Allston was sentenced Thursday to more than 14 years in federal prison for running a Ponzi scheme where he scammed millions of dollars from investors, officials said.
Raymond Montoya, 70, was sentenced to 175 months in federal prison, plus three years of supervised release, and restitution, which will be determined at a later date, the US Attorney’s office for Massachusetts said in a statement.
In October 2018, Montoya pleaded guilty to three counts of wire fraud, five counts of mail fraud, and two counts of conducting an unlawful monetary transaction.
Montoya ran a pooled investment hedge fund in Boston from 2009 to June 2017 called RMA Strategic Opportunity Fund, LLC., prosecutors said.
He told investors the fund was “earning substantial returns,” but it was actually “earning substantial losses,” by 2014, according to the statement.
Investors transferred millions of dollars from their personal savings and 401(k) retirement plans to the fund. Montoya told them he would invest their money in stocks and bonds, but only invested a portion of their money. The rest was diverted to business and personal bank accounts, according to the statement.
He used the money for personal expenses such as luxury vehicles and mortgages on his son’s residence. “Montoya used the diverted money for personal expenses such as luxury vehicles and the mortgage on his son’s residence,” the statement said.
Montoya was previously charged with securities fraud in a civil complaint by the Massachusetts Securities Division.Andrew Stanton can be reached at firstname.lastname@example.org. Follow him on Twitter @_andrewstanton.