On Friday, April 6, 2018, it was announced that a Florida man had been sentenced to prison for defrauding investors in his company of more than $5 million. 59-year-old David Webb of North Palm Beach was sentenced to four years in prison. Court documents show that Webb made false statements to more than 70 investors from Virginia and other states. The defendant claimed that he had a very successful government contracting business G4i Capital Partners.
He also claimed that he would only use the investors’ money to pay subcontractors between the times when contracts were awarded and when the government started to pay invoices. Webb told the investors that their investments were safe. Webb told the investors that a trustee would collect the money owed by the government and repay the investors should the company fail.
Webb also provided false documents and emails to support his fraud scheme. Webb ultimately used new investors’ money to make “interest” payments to earlier investors. The defendant lent a big portion of the money to a friend who was trying unsuccessfully to start his own government contracting business. The defendant also paid himself a salary and used investors’ money for personal expenses.
Webb’s company never acquired a single government contract. Further details have been made available here.