A US court has sentenced two men for their roles in a multimillion-dollar investment fraud that involved bogus letters of credit (L/Cs).

Daryl Miles Brown and Sylvester Mitchell were sentenced in separate hearings before the court.

Jail term

Brown, who was chairman of The Vertical Group in Columbia and principal of Cerberus in Fulton, was sentenced to 15 years in federal prison without parole.

He was also ordered to forfeit to the government US$2 million, this being the proceeds of a scam investment scheme.

High yields promised

In 2008, a federal jury convicted Brown of participating in a conspiracy to defraud investors and seven counts of wire fraud related to the conspiracy.

Brown had masterminded a high-yield investment fraud by selling bogus standby L/Cs, typically in units of US$50,000 (DC World News 7 October 2005).

Bogus claims

The fraudsters met with potential investors and persuaded them to wire funds to accounts controlled by the conspirators.

Brown duped investors into believing he played for a top US football team, graduated with a business degree from the University of Missouri, owned one of the country's top broker-dealers, personally knew prominent celebrities and the chairman of Citigroup and had access to US$5 billion to invest.

Money laundering

Brown was also convicted for conspiring to launder money and making transactions funded by criminal gains.

Mitchell was a Vertical employee who presented himself as the chief financial officer of Cerberus. He was sentenced to four years probation.

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