By Jonathan Stempel
NEW YORK (Reuters) -A Pennsylvania man has been charged with tricking people into investing money he claimed would be used to buy thousands of automated teller machines, causing more than $400 million of investor losses, U.S. authorities said on Wednesday.
Daryl Heller, 55, of Lititz, Pennsylvania, was charged in an indictment with one count of securities fraud and four counts of wire fraud. The U.S. Securities and Exchange Commission filed related civil charges.
A lawyer for Heller
in the criminal case did not immediately respond to a request for comment. The U.S. Attorney's office in Philadelphia had no immediate additional comment.
Authorities said Heller falsely promised investors in his Prestige and WF Velocity funds they would receive 25% returns based on revenue generated by ATMs purchased by his company Paramount Management Group.
According to court papers, many of the machines didn't exist, or were old, broken-down and stored in warehouses.
Heller allegedly used new money to make Ponzi-like payments to earlier investors, while misappropriating $185 million for other companies including two cannabis-related businesses, and personal expenses including a New Jersey beach house.
Authorities said Heller raised about $770 million from approximately 2,700 investors, many from the Amish and Mennonite communities in the Lancaster, Pennsylvania, area, between January 2017 and June 2024.
After new money dried up in April 2024, Heller stopped making distributions and promised investors "a complete buyout to get everyone's capital back," but this never happened, the indictment said.
In February, Heller filed for Chapter 11 bankruptcy protection in Camden, New Jersey.
The cases are US v Heller, U.S. District Court, Eastern District of Pennsylvania, No. 25-cr-00366; and SEC v Heller et al in the same court, No. 25-05036.
(Reporting by Jonathan Stempel in New York; Editing by Howard Goller)
