Man Who Bilked $100M From Investors Escapes Prison

Frederick Berg was discovered missing Wednesday in California
By Newser Editors and Wire Services
Posted Dec 7, 2017 7:35 PM CST
Man Who Bilked $100M From Investors Escapes Prison
Frederick Berg   (US Penitentiary Atwater Prison)

A Washington state man who bilked investors out of more than $100 million in a Ponzi scheme has escaped from a federal prison in central California, according to the US Marshals Service. Prison officials said Frederick Berg, 55, was discovered missing Wednesday from a minimum-security work camp next to a penitentiary in Atwater, California, the Seattle Times reported. Berg in 2012 was sentenced to 18 years after pleading guilty to wire fraud, money laundering, and bankruptcy fraud, according to the AP. Prosecutors said at the time that it was the largest fraud scheme they had prosecuted in Western Washington.

Berg used investment funds from his company, Meridian Group, to buy two Lear jets, several yachts, and million-dollar condos and homes in Washington state and California over the course of a decade, federal prosecutors have said. They said that between 2001 and 2009, Berg used more than $100 million in funds from over 800 investors for his own benefit and to keep his investment fraud scheme going. He used investor money to pay off the loans of earlier investors in order to continue his scheme to defraud, court records show. Berg was arrested in 2010 in Los Angeles.

(More Ponzi scheme stories.)

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