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Indian investment adviser indicted in Ponzi scheme in Alabama
Despite assuring investors of significant profits and the safety of their principal amount, Patel failed to safeguard their capital
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Pathyam Patel, also known as Pat Patel, has been indicted by the Alabama Securities Commission (ASC) / Pexels
A 23-year-old Indian-American investment adviser, Pathyam Patel, also known as Pat Patel, has been indicted by the Alabama Securities Commission (ASC) for his alleged involvement in a Ponzi scheme defrauding investors of over US$400,000. Patel, originally from Gandhinagar, Gujarat, was arrested in Alabama on March 6.
The indictment comprises nine counts of securities law violations, as reported by The Times of India. Patel is accused of selling unregistered investment contracts to at least six victims through a fictitious investment firm called 'Infinity Wealth Management', promising high returns that were never realized.
According to the ASC, Patel claimed association with Infinity Wealth Management, purportedly registered with the US Securities and Exchange Commission. However, investigations revealed that Patel did not invest the funds as promised but instead used them for personal expenses, including gambling and paying other investors.
"Patel did not invest the funds as communicated to the investors. Instead, he used them for gambling on sporting events, personal expenses and paying other investors," ASC stated.
Despite assuring investors of significant profits and the safety of their principal amount, Patel failed to safeguard their capital. The ASC stated that Patel was not registered with them during the scam period, and the investment contracts he sold were also unregistered. Furthermore, Infinity Wealth Management was not registered as an investment advisor or broker-dealer.’
"Patel did not invest the funds as communicated to the investors. Instead, he used them for gambling on sporting events, personal expenses and paying other investors. Patel had no ability to guarantee that the investors would not lose their principal," ASC said.
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