Gerard Frank Cellette Gets 35 Years in Prison for OC's Biggest Ponzi Scheme
Gerard Frank Cellette can now work in prison print shop.
Orange County District Attorney's office
Remember Gerard Frank Cellette, who masterminded the largest Ponzi scheme in Orange County history ($21 mi llion) without leaving his home state of Minnesota?
Orange County Superior Court Judge Patrick Donahue sentenced the 51-year-old Tuesday to 35 years in prison, although with good behavior and time served since his 2013 arrest, Cellette could be out in about 15 years, according to Senior Deputy District Attorney Marc Labreche.
Speaking of being out, Cellette is also out $63.1 million in fines and restitution to victims ordered by Donahue. Cellette is also out the six years he spent in a Minnesota prison due to stinging victims there. Besides elsewhere in California, other victims were in Georgia, Arizona, Colorado, Hawaii and Illinois.
At least Cellette got a good deal by pleading guilty in OC to 455 felony counts, including 382 counts of money laundering, 42 counts of selling securities without a license and 27 counts of using untrue statements in the purchase and sale of a security. He was looking at 329 years and four months in prison if he'd gone to trial and been convicted.
Cellette owned a small-time printing business called Minnesota Print Services Inc. when he concocted a scheme that promised customers discounts if they paid in cash. He told investors he had printing contracts with major corporations and needed the cash upfront to get a 20 percent discount on purchasing paper. Problem was, there were no such contracts.
His $250 million Ponzi scheme—which in classic style had early investors paid off by new investors—resulted in losses of up to $54 million nationally, Labreche said. This allowed Cellette to live a lavish lifestyle that included cars, flights on private jets and multiple homes, where he had a Go-Kart track, bowling alley and a 1950s-themed malt shop installed, among other luxuries.
In a related case, Adam Jay Boskovich of Laguna Niguel originally faced 32 counts that could have sent him to prison for 45 years. He pleaded guilty in May 2015 to misrepresenting or falsifying information and was sentenced to a day in jail and five years probation.
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