On Friday, Senior United States District Judge Arthur D. Spatt sentenced a Long Island investment fund manager to prison for his involvement in a $96 million Ponzi scheme. 48-year-old Brian R. Callahan of Old Westbury, New York was sentenced to 12 years in prison, 3 years of supervised release and was ordered to pay roughly $67.6 million in restitution. Callahan pleaded guilty to securities fraud and wire fraud on April 29, 2014.

Court filings and statements reveal that between December 2006 and February 2012, Callahan raised over $118 million from at least 40 investors in relation to four investment funds he managed. He promised the investors that their money be invested into hedge funds, mutual funds and other securities. Instead of doing as initially promised, Callahan misused approximately $96 million and engaged in a large-scale Ponzi scheme.

Millions of dollars were diverted for the Panoramic View, which is an unprofitable beachfront resort and residence development in Montauk. Callahan and his brother-in-law and co-defendant, Adam Manson, owned the property. The defendant also commingled the money from various funds and used it to pay partial redemptions to some victims.

Callahan paid himself $6 million, which was used to buy luxury homes in Westhampton and Old Westbury. He also used the money for luxury cards, credit card bills and golf club fees. Callahan created and sent fake account statements to investors to keep the scheme concealed. He also lied to investors about the nature and status of their investments.

In December 2015, Judge Spatt ordered the forfeiture of roughly $40 million in proceeds from the sale of the Montauk property. Now, Brian R. Callahan has been sentenced to 12 years in prison for the Ponzi scheme.