The former host of the Christian radio show “Follow the Money” was sentenced Monday in U.S. District Court in Minneapolis to 20 years in prison for his part in a $194 million Ponzi scheme, said the U.S. attorney for Minnesota.
Patrick Kiley, 75, was convicted of 12 counts of wire and mail fraud, one count of conspiracy to commit wire and mail fraud and two counts of money laundering. According to prosecutors, he and three co-defendants, who were sentenced earlier, defrauded more than 1,000 victims with a scheme that promised between 10.5 percent and 12 percent annual interest rates with little or no risk.
The four involved in the scheme were ordered to pay more than $155 million in restitution to the victims. Kiley, of Burnsville, Minn., will not be eligible for parole because it is not offered in the federal justice system.
The evidence presented at trial showed that between 2005 and 2009, the defendants defrauded investors by soliciting them to invest money in a foreign currency trading program. They falsely claimed investor assets would be held in a segregated account and could be withdrawn at any time.
The defendants made the investment offers through an entity known as Universal Brokerage Services, bearing the acronym “UBS,” but having no connection to the international financial services firm UBS AG.
Kiley promoted the investments through his radio show. To induce investors, the defendants made false representations about the performance, safety and liquidity of the currency program. They also omitted material information about their backgrounds and qualifications, as well as the qualifications of the people working for them, the U.S. attorney said.
Some investors received UBS account statements for their money indicating the currency program was performing as promised, while others received checks for returns on their investments. Both the statements and checks, however, were actually produced by Kiley and the other defendants.
After UBS AG filed a trademark infringement lawsuit against the defendants in 2007, they began operating their scheme under other names, including Oxford and Universal Brokerage FX.
Kiley's radio show was carried on more than 200 stations nationwide.
He is the second radio personality to be sentenced for misleading investors this month. Raymond Lucia Sr., a syndicated radio host based in San Diego with a wealth management system called “Buckets of Money,” was ordered to pay $50,000 for giving investors misleading information.