A Lecanto, Fla., investment advisor has been sentenced to more than eight years in prison for taking nearly $2 million from elderly and unsophisticated clients, the Securities and Exchange Commission announced Wednesday.
Michael Donnelly, the former president of Coastal Investment Advisors Inc., was sentenced to 99 months in prison and ordered to pay $1.99 million in restitution in U.S. District Court in Philadelphia April 11. He pled guilty to securities fraud and wire fraud in December 2015.
Donnelly took money from his clients and used it for his personal expenses, including his children’s private school tuition, the SEC says. He previously agreed to be barred from the financial industry after the SEC filed a complaint against him for the same fraudulent activity.
Donnelly concealed his scheme by providing investors with false account statements, trade confirmations and other untrue information that purportedly reflected their investment holdings and repeatedly told investors that their fictitious investments were performing well, the SEC says.