The FBI has arrested a Columbian man this week in connection with an allegedly fraudulent investment scam that promised ultra-high returns, but apparently succeeded only in defrauding would be investors of at least US$3.1 million.

Daryl Miles Brown stands accused of participating in frauds that fleeced victims from across the world after impressing them with boasts that he knew celebrities and had access to US$5 billion.

Other suspected participants in the scam have so far escaped arrest while other fraudsters connected with the case remain unidentified.

L/Cs employed

Brown, identified as chairman of Vertical Group LLC and a principal of Cerberus Inc is being held without bond in a US jail on federal wire and travel fraud charges.

He is charged with participating in a high-yield investment fraud by selling bogus standby letters of credit (L/Cs), typically in units of US$50,000.

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

Boasts

The FBI alleges that Brown duped investors into believing he played for a top US football team, owned one of the country's top 12 broker-dealers, had a personal relationship with prominent celebrities, knew the chairman of Citigroup and had access to a pool of US$5 billion to invest.

Brown apparently started participating in the frauds this year but he appears to have little money left, which investigators say is because he has spent his share of the proceeds on an expensive lifestyle rather quickly.

Fraudsters wanted

Defendants named in the lawsuit along with Brown are Nathan Paul Reuter, Rickey Dean Williams and Bud Allen Wofford. Efforts to reach Brown's co-defendants have so far been unsuccessful.

The US authorities have recorded more than 20 complaints from investors as far away as Australia. The FBI says it has yet to identify all of the participants in this investment scam.

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