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Indiana Businessman Gets 5 Years For Ponzi-Style Scheme

By Associated Press

Posted July 31, 2021

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Prosecutors said 34 investors lost nearly $1.5 million because of Blankenbaker’s scheme.

A central Indiana businessman has been sentenced to a 5-year prison term after pleading guilty in a Ponzi-style scheme that cost dozens of investors nearly $1.5 million.

George S. Blankenbaker Jr., 56, was sentenced Wednesday by a federal judge in Indianapolis who also ordered him to pay $1.5 million in restitution and to three years of supervised release.

The Westfield man pleaded guilty in April to two counts of federal wire fraud and one count of money laundering, the Indianapolis Business Journa l reported.

Federal prosecutors said Blankenbaker, the president of Indianapolis-based Stevia Corp., orchestrated a Ponzi-style scheme in which he induced 100 investors, many of them elderly, to sink more than $11 million into his three companies.

Investigators said Blankenbaker diverted investment money more than 300 times to fund unrelated business ventures, pay personal expenses, make interest payments and return principal payments to investors.

Prosecutors said 34 investors lost nearly $1.5 million because of Blankenbaker’s scheme.

In a separate action in April, the U.S. Securities and Exchange Commission announced that the Blankenbaker-controlled companies involved in the scheme had agreed to pay almost $5.2 million in a preliminary settlement.

Blankenbaker also consented to an administrative proceeding barring him from the securities industry.

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