Ventura County Ponzi scheme perpetrators sentenced to federal prison

May 21, 2013

handsThree Ventura residents were sentenced to federal prison on Monday – with one defendant being ordered to serve more than 17 years – for their roles in a Ponzi scheme that caused losses of more than $27 million.

The three defendants – two brothers and a woman, all of whom shared a house in Ventura – fraudulently raised money by telling victim-investors that funds would be used to purchase Ad Toppers, a video device that can be placed on ATMs or vending machines and used to display advertisements.

Alan G. Flesher, 65, the leader of the scheme, was sentenced to 210 months in federal prison; Wayne D. Flesher, 62, Alan’s brother, was sentenced to 72 months in prison; and Nancy Carol Khalial, 65, who was sentenced to 48 months in prison.

United States District Judge Terry J. Hatter Jr. also ordered the defendants collectively to pay $27,377,470 in restitution.

Even though the scheme took in approximately $41 million from approximately 790 victim-investors from approximately 2001 to 2005, the defendants did not place most of the ATMs and Ad Toppers sold to investors.

“In other words, defendants sold nonexistent ATMs and Ad Toppers and paid the later investors with the funds from the earlier investors,” prosecutors wrote in court documents filed in relation to today’s sentencings.

The defendants used the majority of investor funds to pay personal expenses and to continue operating the fraudulent scheme by paying personal salaries, sales commissions and by making Ponzi-style payments.




  1. womanwhohasbeenthere says:

    17 1/2 years, six years and four years for raking in $41 million? That was a pretty good run! They will be out in half that time for good behavior. And they will never pay the money back. What a racket. They will live at taxpayers’ expense in a country-club federal prison with free meals, medical care, gym access, etc.; in other words they will be better off than the people they fleeced.

    (8) 12 Total Votes - 10 up - 2 down
  2. Bert says:

    “In other words, defendants sold nonexistent ATMs and Ad Toppers and paid the later investors with the funds from the earlier investors,” prosecutors wrote in court documents filed in relation to today’s sentencings.

    This is how Social Security works, but they don’t bother to tell you they’re not buying Ad Toppers. It’s the biggest Ponzi scheme out there.

    (1) 17 Total Votes - 9 up - 8 down
    • r0y says:

      Social Security is only a Ponzi scheme if it was an actual investment style account. Social Security is a tax. Whomever is paying the tax is funding the collectors – this is how all taxes essentially work.

      I understand why you would call it a Ponzi scheme (I have in the past, when explaining taxing/redistribution isn’t sinking in), as like most all progressive scams, it’s misleading by it’s very name (think “Federal Reserve” or “Planned Parenthood”) and thus born in lies. However, it’s been so long that most people have been told “you paid into it, it’s your money” type misinformed definitions that they actually believe it; thus, often a Ponzi scheme explanation is needed.

      However, if one has even a rudimentary understanding of taxation, it’s pretty self evident that it is just one more tax to redistribute “current” wealth.

      (-8) 12 Total Votes - 2 up - 10 down
      • Bert says:

        The difference is that with SS you are required to pay, as you are any tax. Whereas in an investment style Ponzi scheme it is optional to buy in? I think there are more similarities than differences.

        The Fed Reserve act was signed by Wilson, a progressive, but the architects of the act were not entirely progressive, your claim is a harsh generalization. Wilson was a puppet for this.

        I don’t see what planned parenthood has to do with any of this. They do a lot of good and if you think about it, the name is fitting. They help in the plans of whether or not to become a parent.

        (-4) 12 Total Votes - 4 up - 8 down
      • FineWine says:

        Thats just not true roy. Haven’t you received your annual statement. What you get from SS directly correlates with what you put in. The program was designed and has its own budget or as some call it a lockbox, (which is full of government bonds because they have stole the money to use for other expenditures). The working people on the bottom pay the retired people at the top no different than a true pnozi scheme. A true ponzi scheme has nothing do with investments. It has to do with the fact there is no real investments. Just those supporting others, then still others supporting those others until there is no more others to support the all those at the top, than they all lose.

        (2) 2 Total Votes - 2 up - 0 down
  3. Mr. Holly says:

    Only 8 years to prosecute. Maybe there is still hope for the Miller/Gearhart victims.

    (10) 10 Total Votes - 10 up - 0 down

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