COLUMBUS, Ohio – The Ohio Department of Commerce Division of Securities has announced the conclusion of a major, multi-year investigation into a $72 million Ponzi scheme that led to significant prison sentences and more than $55 million in restitution orders against those responsible for defrauding Ohio investors.
The Lucas County Court of Common Pleas handed down the final sentences this week, marking a major step toward accountability in the long-running case.
During sentencing hearings held this past Monday and Tuesday, June 29-30, Richard Schiech, a former executive with Toledo-based Northwest Capital, was sentenced to a total of 11 years imprisonment and ordered to pay more than $15 million in restitution.
Because his sentences run concurrently, he will serve four years in prison. James Delverne, a former investment adviser with Northwest Capital, was sentenced to 17 years imprisonment and ordered to pay more than $25 million in restitution. His sentences also run concurrently, resulting in four years in prison.
In addition, Doug Miller, who co-managed Private Wealth Consultants in Toledo, was sentenced in connection with the scheme to over 12 years in prison.
His sentences also run concurrently, resulting in seven years in prison. He was also ordered to pay more than $15 million in restitution.
Nancy Rathbun, the office manager and treasurer of Private Wealth Consultants, was sentenced to 120 days in jail, 120 hours of community service, and two years of parole. She was also ordered to pay a $5,000 fine.
The case is the result of a multi-year investigation led by the Division of Securities in partnership with the Ohio Attorney General’s Bureau of Criminal Investigation.
Deputy Attorney Inspector Harvey McCleskey led the investigation for the Division, while the prosecution was led by Principal Assistant Attorney General Dan Kasaris and Assistant Attorney General Drew Wood.
“These sentences mark the end of a complex, years-long effort to bring accountability to those who misled Ohio investors,” said Department of Commerce Director Sherry Maxfield.
“I am proud of our enforcement team with the Division of Securities, whose dedication over many years, working hand-in-hand with the attorneys from the Ohio Attorney General’s Office, made this moment possible. Their work reflects our unwavering commitment to protecting Ohioans.”
“Reaching this milestone in such a complex case is a proud moment for our entire Division,” said Ohio Securities Commissioner Andrea Seidt.
“This investigation demanded extraordinary persistence and expertise over many years. Our team’s unwavering commitment to pursuing justice for innocent Ohioans – people who placed their trust in individuals who ultimately took advantage of them – shows exactly what it means to protect investors in our state. Their dedication is what made these results possible.”
From January 2011 through December 2021, managers at Northwest Capital in Toledo, along with the investment advisers at Private Wealth Consultants and other co-defendants from entities who worked with the firms, misled investors about critical facts, including conflicts of interest within the organization and the financial health of affiliated entities.
Investigators alleged that funds were manipulated to create an illusion of success, while investors received falsified annual statements to conceal the scheme’s reality.
While investors received annual statements supporting the value of their investments, these values ultimately proved to be false when investors requested redemption of their investment principal and Northwest Capital was unable to fund those redemptions.
