Hedge Fund Manager Sentenced for Operating Multi-Million Dollar Ponzi Scheme
BOSTON – A Boston-area hedge fund manager was sentenced today in federal court in Boston for running a multi-million dollar Ponzi scheme.
Raymond K. Montoya, 70, of Allston, was sentenced by U.S. Senior District Court Judge George A. O’Toole Jr. to 175 months in prison, three years of supervised release and restitution to be determined at a later date. In October 2018, Montoya pleaded guilty to three counts of wire fraud, five counts of mail fraud, and two counts of conducting an unlawful monetary transaction.
Between 2009 and June 2017, Montoya ran a pooled investment hedge fund in Boston called RMA Strategic Opportunity Fund, LLC. Montoya falsely told his investors—including his family, friends, and acquaintances who resided in Massachusetts, Ohio, and California—that the fund was earning substantial returns, when in fact, by 2014, the RMA Fund was sustaining substantial losses. The investors transferred millions of dollars of their personal savings and 401(k) retirement plans to Montoya and the RMA Fund. Montoya told the investors that he would invest their money in stocks and bonds, but he actually invested only a portion of their money, while diverting the rest—totaling millions of dollars—to business and personal bank accounts. Montoya used the diverted money for personal expenses such as luxury vehicles and the mortgage on his son’s residence.
Montoya was previously charged with securities fraud in a civil complaint by the Massachusetts Securities Division.
United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; and Kristina O’Connell, Special Agent in Charge of the Internal Revenue Service’s Criminal Investigation in Boston, made the announcement today. The Massachusetts Securities Division provided valuable assistance. Assistant U.S. Attorney Neil J. Gallagher Jr. of Lelling’s Criminal Division is prosecuting the case.