Ex-UGA student from Augusta pleads guilty in $1 million Ponzi scheme – News – The Augusta Chronicle

A former University of Georgia student whom federal authorities said was operating a Ponzi scheme that defrauded investors of about $1 million pleaded guilty Friday in U.S. District Court in Macon.

Syed Arham Arbab, 22, of Augusta, pleaded guilty to securities fraud. He will be sentenced Jan. 8 at the Federal Courthouse in Athens.

Arbab, who had an elaborate plan to defraud his investors, operated out of his fraternity house, defrauding 117 investors including fellow students, prosecutors said.

“The defendant engaged in a pattern of deceit to gain the trust of unwitting investors who gave him their hard-earned money for what they believed was a sound investment. Instead of investing the victims’ money, the defendant funded a lavish lifestyle,” U,S. Attorney Charlie Peeler said in a statement released Friday.

The FBI investigated the case and determined that Arbab spent the money on clothing, shoes, fine dining, alcohol, adult entertainment and travel, including spending thousands gambling during three trips to Las Vegas in 2018.

“The victims of this scheme, many of them students, will never recover their losses, but can rest assured that Arbab’s greed will not go unpunished,” Atlanta FBI Agent Chris Hacker said.

Agents said Arbab, while an undergraduate student, started two investments entities and fabricated the fund’s investment returns. He promised many “risk-free” investments and convinced some that a famous NFL player and UGA alumnus was an investor.

Arbab faces five years in prison, a $10,000 fine and is subject to any restitution the court might order.