Prosecutors: 3 men charged in $364 million Ponzi scheme

BALTIMORE (AP) -- Three men are facing a slew of charges in a $364 million investment scheme that entrapped more than 400 victims nationwide, federal prosecutors in Baltimore announced Wednesday.

U.S. Attorney Robert Hur announced at a news conference in downtown Baltimore that 53-year-old Kevin Merrill of Towson, Maryland; 54-year-old Jay Ledford of Westlake, Texas, and Las Vegas; and 28-year-old Cameron Jezierski of Fort Worth, Texas, have been arrested and charged with conspiracy, wire fraud, identity theft and money laundering.

The indictment alleges that Merrill and Ledford invited people to buy consumer debt portfolios and falsely represented that they'd profit from debt payments and flipping portfolios.

"Most of these investors are just learning that they have been victimized," said Hur, alongside officials from the FBI and the U.S. Securities and Exchange Commission.

Prosecutors assert the "proceeds" paid out came from other investors, not collections or sales, as represented. The men created impostor companies and incorporated them in Texas, authorities said.

Authorities said the three suspects concealed their diversion of $73 million, which they used to fund a "lavish lifestyle." The accused bought multiple properties, fancy watches and more than 20 high-end cars, including Ferraris and Lamborghinis.

Some $25 million was spent on casino gambling, prosecutors allege.

It was not immediately known if the suspects had defense attorneys who could comment on the charges. Lawyers for the three men were not listed in online court records.