The head of a small South Carolina investment firm was sentenced on Wednesday to 10 years in federal prison for bilking dozens of people out of millions in two alleged fraud schemes.
Daryl Batts, owner and operator of Comprehensive Financial Solutions Inc. in Easley, was also sentenced to five years of supervised release during a 90-minute hearing in federal court in Anderson, Assistant U.S. Attorney David Stephens said.
Batts, who pleaded guilty in July to one count each of securities fraud and mail fraud after he was confronted by authorities, had faced up to 50 years in prison and a $500,000 fine.
Authorities say more than 100 people invested about $12 million with Batts, who told them he would use it to buy securities. Instead, prosecutors say Batts deposited the money into his own accounts, fabricating monthly statements showing substantial gains for those clients, and used some of the money to pay out insurance premiums for policies he never filed.
Of the $12 million he took in from more than 100 investors, Batts used $3 million to keep schemes going, paying initial investors with money from new investors and funding four offices for his insurance business, Stephens said.
"Mr. Batts was essentially taking the money he was stealing from his illegal business and using it to fund his legal insurance systems," Stephens said.
A receiver appointed to track Batts' money has recovered about $3 million, and a federal judge will decide later how much restitution should be paid to the investors.
If you were among the many people who suffered as a result of the deceitful practice of a stockbroker or financial advisor, contact the experienced financial fraud litigation attorney Thomas C. Bradley today for a free consultation.