CENTRAL ISLIP - An investment advisor and fund manager from St. James is accused of running a $17 million Ponzi scheme over the course of nearly a decade.
James Peister, 62, pleaded not guilty today in federal court in Central Islip after prosecutors unveiled a five-count indictment. He is charged with securities, wire and mail fraud.
The U.S. Attorney's Office says Peister preyed on innocent investors to construct a "house of cards." The FBI says that from 2000-09, Peister swindled and conned investors from his Oceanside office to support his lavish lifestyle.
Peister is accused of defrauding 74 investors from Long Island and all over the country. Prosecutors say he assured his clients their money would be safe, but instead stole it for himself. To keep up the alleged scheme, the FBI says he sent phony account statements to investors that showed their funds were well-performing.
Prosecutors say Peister's scam started to collapse in the wake of the financial crisis, when he could no longer keep pace with demands from nervous investors.
If convicted, Peister faces up to 20 years in prison for each count and also faces about $6 million in fines. He is being held on $1.5 million bond and is due back in court next week.
The U.S. Attorney's Office said it seized Peister's Hummer and his St. James home.