Boston Man, 27, Arrested in Multi-Million Dollar Fraud Scheme

Boston, MA - Police arrested a Boston man Thursday, accused of swindling eight investment firms out of nearly $3 million over a three-year period.

The criminal complaint charges 27-year-old Nathaniel Ponn with two counts of wire fraud. In a press release from its Massachusetts District, the U.S. Attorney’s Office outlined the allegations laid out in court documents against Ponn:

• 2012 through early 2015 - Ponn allegedly opened more than 400 brokerage accounts at nine investment firms throughout the country under false names and financial information. The firms allow customers to transfer funds from another financial institution into the customer’s brokerage account through an Automated Clearing House (ACH) transfer, by providing the account number and financial institution where the account was held and the amount to be transferred.
• February 2014 to April 2015 - Ponn provided ACH transfer information to brokerage firms for accounts he opened on more than 350 occasions, totaling more than $8.5 million in attempted transfers. In each instance, the bank account Ponn provided did not have the amount of funds requested or, in some circumstances, did not even exist. Although the ACH transfers were rejected, the fraudulent transfers created the false appearance that the brokerage accounts had cash available to purchase securities.

Even though the brokerage firms rejected the transfers, they still created the illusion that his accounts had cash available. In this way, Ponn allegedly managed to obtain more than $2.7 million worth of securities from eight of the firms. When the firms discovered that the ACH transfers were rejected, they liquidated the securities in Ponn’s accounts, the press release notes.

He was scheduled to appear in court Thursday afternoon.