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FLA. PONZI FRAUDSTER: GUILTY OF RUNNING $12 MIL. INVESTMENT SCHEME

By   /   August 4, 2014  /   No Comments

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Blayne Seth Davis. Mugshot.

Blayne Seth Davis. Mugshot.

A central Florida man faces up to 20 years in prison after pleading guilty to fraud charges in connection with an $11.9 Ponzi investment scheme.

Blayne Seth Davis, 33, bilked almost 100 victims, including family and friends, in the foreign-currency exchange investment scheme.

According to prosecutors, Davis now-defunct company, Capital Blu, raised funds from investors beginning in the early 2000’s, and misrepresented the performance of the investments.

Davis, who was director of trading for Capital Blu, along with two associates convinced their victims to invest millions into off-exchange foreign currency (forex) trading through an entity called the CBM FX Fund LP, according to a report in the Orlando Sentinel.

The three fraudsters spent  the stolen money from their investment scheme on luxury automobiles, expensive vacations, private jet charters and a two-night $40,000 spree at a strip club, according to the civil complaint.

Davis is scheduled to be sentenced in October when he could be sentenced to  20 years in prison.  At the October sentencing, Davis will be ordered to pay $11.8 million in restitution to his victims.

Davis was also convicted of wire fraud in 2011 involving a separate Ponzi investment scheme.  In that case,  prosecutors alleged Davis used Capital Blu investors to pay off the investors for the earlier scheme — a classic Ponzi structure.

The other two defendants are: Capital Blu co-founder and operations director Damien L. Bromfield, who has pleaded guilty to wire-fraud conspiracy, and is awaiting sentencing; and Donovan G. Davis, Jr., who has pleaded not guilty and is awaiting trial.  Donovan Davis is not related to Blayne Davis.

 

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