Gustavo Guzman, a 61-year-old former resident of Fullerton, California, was sentenced to 70 months in prison for orchestrating an investment fraud scheme that defrauded victims of nearly $2 million. The sentence includes two years of supervised release and an order to pay over $1.9 million in restitution. This announcement was made by Dena J. King, U.S. Attorney for the Western District of North Carolina.
Guzman was extradited from Australia in November 2022 to face federal charges in North Carolina. Joining U.S. Attorney King in the announcement were Robert M. DeWitt, Special Agent in Charge of the FBI Charlotte Division, and North Carolina Secretary of State Elaine F. Marshall.
Court documents reveal that between April 2010 and August 2015, Guzman used entities like G2 Asset Management and East Egg Private Equity to defraud approximately ten investors by falsely promising to invest their money in options and similar investments. Instead, he misappropriated a significant portion for personal expenses such as credit card payments and cash withdrawals.
The court records also indicate that Guzman incurred substantial trading losses with some invested funds and used part of the victims' money for Ponzi-style payments to other investors. To hide these losses and maintain his scheme, Guzman provided false information and documents to his victims.
When Guzman learned about impending charges, he fled to Australia but was later extradited back to the United States. He pleaded guilty to securities fraud in July 2023.
U.S. District Judge Robert J. Conrad Jr., who announced the sentence, described Guzman's actions as "reprehensible conduct that occurred over a long period of time." Several victims suffered financial hardship and emotional distress due to Guzman's deception.
The FBI Charlotte Division and the Securities Division of the North Carolina Department of the Secretary of State conducted the investigation into Guzman's activities. A parallel investigation by the U.S. Securities and Exchange Commission resulted in a default judgment against him.
The Department of Justice acknowledged assistance from various international agencies, including Australia's Attorney General's Department and Federal Police, which facilitated Guzman's extradition.
Assistant U.S. Attorney Daniel Ryan prosecuted the case on behalf of the U.S. Attorney’s Office in Charlotte.