ATLANTA,None — The man behind a multi-million dollar Ponzi scheme exposed by Channel 2 will spend years in federal prison.
Mastermind Charles Vaughn spent investors' money on a lavish lifestyle.
In a document uncovered by Channel 2's Jim Strickland, Vaughn admits his guilt to wire fraud and further admits his victims lost at least $7 million.
After Strickland first exposed Vaughn's scheme in 2008, victims now want to know what took so long.
"The system moves so slowly there is no way that it can protect small business owners like me," said Vaughn's recent IT vendor Mary Hester.
Hester's company installed his computers for Vaughn's latest venture, a liquor importing business selling a high-end French vodka called Le Sin.
"We invoiced $12,000 dollars and we got nothing," she said.
Hester's said her equipment is missing. She said if the feds had moved quicker with an arrest, she would not have been duped.
"This has dragged on for some reason, way too long," agreed Ponzi scheme victim David Graybeal.
Graybeal is Vaughn's former father-in-law and his first bankruptcy lawyer.
"I turned over my money to him," Graybeal said.
"How much?" asked Strickland.
"Turned over $65,000," Graybeal said.
"How much of that money do you have now?" asked Strickland.
"Zero. In fact, I'm in the hole," said Graybeal.
Prosecutors say the case involved a tangled web and accounts and transactions, and sorting them out took an exhaustive effort.
United States Attorney Sally Quillian Yates said in a statement emailed to Strickland Friday afternoon: “Charles Vaughn was brought to justice on October 24, 2011, when he pleaded guilty to operating a Ponzi scheme that affected victims from around the country.
“These victims had invested their savings and retirement funds with a man who successfully convinced them that they could earn large returns by investing with him. Instead, the defendant used their money to finance his extravagant lifestyle.
“The defendant used multiple bank accounts and credit cards, and agents had to follow an extremely complex money trail in order to unravel the details of the scheme. Fortunately, as a result of his guilty plea, Vaughn now faces a substantial term in federal prison.”
The prosecutors and Vaughn agreed to a sentence of more than four years. Vaughn will hear his sentence early next year. Until then, he's free on bond.
Vaughn is currently living in a Dunwoody condo. He didn't answer when Strickland rang his intercom.