A former University of Georgia student has pleaded guilty to a single count of securities fraud for running a million-dollar Ponzi scheme from his Athens fraternity house. The student, 22-year-old Syed Arham Arbab, admitted to defrauding 117 investors in U.S. District Court in the Middle District of Georgia. Charlie Peeler, U.S. Attorney for the Middle District of Georgia, said, “The defendant engaged in a pattern of deceit to gain the trust of unwitting investors who gave him their hard-earned money for what they believed was a sound investment.”
Between May 2018 and his graduation in May 2019, Arbab persuaded investors to invest in Artis Proficio Capital Management and Artis Proficio Capital Investments. He promised the investors returns of up to 56 percent at one stage, and offered a “risk-free guarantee” on the first $15,000 invested. Many invested less than that amount and believed they’d at least get their entire principal investment back.
Arbab admitted in court that he knew he did not have the money to make good on these guarantees when he made them. He also acknowledged misrepresenting the funds’ returns, the number of investors, total funds invested, and the types of investments being made. Prosecutors said that instead of making the investments as promised, he spent the money on alcohol, trips to Las Vegas, adult entertainment, fine dining, clothing, and shoes.
Arbab now faces up to five years in prison, in addition to a $10,000 fine. He is scheduled for sentencing in January.