Minnesota adviser gets six-year prison sentence for Ponzi scheme

A Minnesota-based investment adviser has received a six-year prison sentence for stealing from clients and perpetuating a Ponzi scheme, according to an announcement Wednesday from the Minnesota Department of Commerce.
The 40-year-old adviser, Levi David Lindemann, was sentenced to 74 months in prison by a U.S. district court, after having pled guilty earlier this year to federal mail fraud and money-laundering charges.
Mr. Lindemann owned and operated Gershwin Financial Inc., which did business under the name Alternative Wealth Solutions, between 2009 and 2014.
“Lindemann abused his position of trust as a financial adviser to steal from his clients, including the elderly,” Mike Rothman, Minnesota’s commerce commissioner, said. “Lindemann defrauded his victims by promising to put their money in legitimate, safe investments when he actually used the funds to pay for personal expenses and Ponzi-type payments to other clients to cover up and continue his fraud.”
Paul Engh, an attorney at an eponymous law firm and who represented Mr. Lindemann, according to court records, did not return a request for comment by press time.
According to Mr. Lindemann’s guilty plea, he solicited funds from roughly 50 investors and said he would “use the invested funds to buy secured notes or other legitimate investment vehicles,” the Minnesota announcement said.
However, Mr. Lindemann used investors’ money to pay personal expenses, such as the purchase of a sport utility vehicle, and make payments of promised returns to other investors. He tried to conceal the fraud by creating counterfeit secured notes as proof of clients’ investments, according to the announcement.
In April, the Securities and Exchange Commission permanently barred Mr. Lindemann from the industry, according to his BrokerCheck report.