LOS ALTOS, California — A San Francisco Bay Area investment manager has been indicted by a federal grand jury on 29 counts of fraud for allegedly illegally diverting millions of dollars of his investors' money.
The San Jose Mercury News reported Thursday (http://bit.ly/1xyYrJF) that 51-year-old Mark Feathers pleaded not guilty and was released on $250,000 bail.
The Los Altos resident is founder and CEO of Small Business Capital Corporation, which managed funds that sold investments in mortgage portfolios.
According to the indictment, Feathers raised $50 million from over 250 investors and improperly transferred more than $7 million from the funds to the firm.
He is also accused of diverting $2 million to his own accounts.
The indictment also alleges that some returns paid to early investors were funded with money provided by new investors in a Ponzi scheme.
Information from: San Jose (Calif.) Mercury News, http://www.mercurynews.com