Gustavo Guzman, 61, formerly of Fullerton, California, was sentenced today to 70 months in prison for orchestrating an investment fraud scheme that defrauded victims of nearly $2 million, the U.S. Attorney’s Office for the Western District of North Carolina announced.
Guzman was also ordered to pay more than $1.9 million in restitution to his victims. His conviction follows his extradition from Australia, where he had fled after learning that federal authorities were preparing charges against him.
Between April 2010 and August 2015, Guzman operated a fraudulent scheme through entities he controlled, including G2 Asset Management and East Egg Private Equity. He solicited investments from individuals he knew, including close friends, often presenting himself as a trusted family friend. However, instead of using the funds as promised, Guzman misappropriated the money for personal expenses, including large credit card payments and cash withdrawals.
Guzman also faced significant trading losses, which he attempted to conceal by using some of the funds to make Ponzi-style payments to other investors. To cover up his illegal activities and prevent victims from recovering their investments or reporting him, Guzman provided fake documents, including fraudulent IRS forms and account statements.
After learning of the impending federal charges, Guzman fled to Australia, where he was later apprehended and extradited back to the U.S. He is now in federal custody, and his sentencing serves as a reminder of the severe consequences for those involved in fraudulent investment schemes.