KANSAS CITY, Mo. (AP) — A Kansas City man has been sentenced to more than eight years in federal prison for running a Ponzi scheme that defrauded dozens of victims out of millions of dollars, federal prosecutors for Missouri said.
Matthew Peterson, 51, was sentenced Wednesday to eight years and one month and ordered to pay more than $2.5 million in restitution to his victims, the Kansas City Star reported.
Peterson pleaded guilty in September to single counts of bank fraud and money laundering. Prosecutors said Peterson admitted to operating the scheme from 2012 to 2016, getting at least 37 victims to invest about $6 million in sporting wagers. He claimed to be a sports betting expert and said the investments were yielding large returns.
“Peterson, for the most part, did not invest funds on behalf of the investors,” federal prosecutors said in a news release. “Instead, Peterson perpetrated a multimillion-dollar Ponzi scheme through which he fraudulently transferred new investor money to earlier investors, falsely representing these payments as profits earned on their funds invested with him.”
Peterson also diverted about $560,000 of the investors’ funds for personal use, including for luxury vacations with his family, prosecutors said.