MACON, Ga. (WRBL) – A former University of Georgia undergraduate student was sentenced to prison for running a Ponzi scheme from his fraternity house, which collected approximately $1 million in investments and defrauded 117 investors.
Syed Arham Arbab, 23, was sentenced to 60 months in prison, followed by three additional years of supervised release by United States District Judge, after pleading guilty to a count of Securities Fraud in October 2019. There is no parole in the federal criminal justice system.
Arbab is now required to pay back $509,032.12 in restitution. This is the maximum sentence allowed under the law, according to Charlie Peeler, U.S. Attorney for the Middle District of Georgia.
Arbab took advantage of unexperienced investors, which included other students, by persuading those who trusted him with continuous lies and the money obtained would then be spent on luxury trips to Las Vegas, fancy clothing, adult entertainment, and big shopping excursions for himself, according to the U.S. Attorney, Charlie Peeler.
“Arbab lied about pursuing an MBA, lied about having the support of a famous UGA grad, lied about the amount of capital he raised and lied about what he was doing with investors’ money. Arbab is not some sloppy bookkeeper. He never had the capital to back up the phony returns he promised investors,” said U.S. Attorney Charlie Peeler.