By Joe Tash
A Florida man who bilked a retired Rancho Santa Fe couple, their son and daughter, and dozens of other victims out of millions of dollars in a Ponzi scheme has been sentenced to 12 years in federal prison.
George Elia, 69, was sentenced June 12 by U.S. District Judge Kathleen Williams. His co-defendant, James “Jim” Ellis, described by victims as a recruiter for Elia’s fraudulent investment scheme, was earlier given a 38-month sentence. The legal proceedings took place in South Florida.
According to businessman and investor Michael Imbesi, whose parents, Peter and Marlene Imbesi, live in Rancho Santa Fe, the family lost nearly $4 million to Elia, which they have not recovered.
Over a six-year period beginning in 2005, Imbesi invested some $3.3 million with Elia, while his parents invested their retirement nest egg of $250,000, and his cancer-stricken sister, Giovanna, invested $200,000. Giovanna’s boyfriend invested $25,000.
The family has filed a lawsuit against Elia, which is pending.
Elia and Ellis, 70, operated a Ponzi scheme in which money from new investors was used to pay artificially high returns to original investors, thus attracting more people to participate in the scam.
Elia promised investors their money was safe, and that he could generate high rates of return from day trading of stock, including Facebook stock, said a statement from prosecutors.
In 2011, however, payments to investors became irregular, investors filed lawsuits against Elia, and in January 2012, Elia sold his Ft. Lauderdale home, shipped his belongings to his native Cyprus, and fled. He was arrested in March 2012 when he flew to Las Vegas with his wife, Darlene Elia.
Elia swindled about 50 victims out of some $10 million, prosecutors said, using investor money to buy two Bentleys, a Rolls Royce, and jewelry worth some $500,000, prosecutors said.
“He took in this money starting in 2005 and literally just went shopping. The money never got invested,” said Imbesi. “It’s just outrageous.”
Until the scheme began to fall apart, Elia was a model of propriety, said Imbesi. He was easy to reach and timely with statements and interest payments.
Ellis, the co-defendant, told people he had inherited money from his father, and that Elia was doing a brilliant job managing the money, Imbesi said. Ellis wore a flashy Rolex watch, drove a Mercedes and dined at upscale restaurants. Imbesi met Elia through Ellis.
Many of the investors lived in Wilton Manors, a predominantly gay community near Ft. Lauderdale, prosecutors said in court documents.
After Elia’s trial concluded in March, Imbesi said he flew to Cyprus, where he was successful in obtaining a legal judgment that allowed him to seize the contents of the couple’s shipping container full of furniture and other personal possessions. Imbesi found photographs of Elia and his wife posing with their booty, such as cars and jewelry, inside the container. The photos were provided to the judge at Elia’s sentencing, Imbesi said.
Imbesi, his 83-year-old father and other family members are still reeling from the loss of their investments.
“It’s like an emotional grenade was thrown into my family’s life,” he said.
Referring to Elia, Imbesi said it’s difficult to comprehend how “someone could be absent of any kind of moral compass whatsoever.”