Shawn Merriman Pleads Guilty In Colorado Ponzi Case; Faces 20 Years In Prison For Swindling Investors And Using Money To Buy Rembrandt Paintings And Go On Safari

Shawn R. Merriman has pleaded guilty to mail fraud in a Ponzi scheme case that swindled dozens of investors in Colorado,  Minnesota and Utah. The scheme involved more than $20 million, prosecutors said.

Merriman, 46, of Aurora, Colo., faces up to 20 years in prison and a fine of up to $250,000. The SEC said he used some of the money to buy valuable art, including works by Rembrandt.

Like Bernard Madoff and others, Merriman’s scheme featured bogus account statements.

“Merriman repeatedly deceived investors, many of whom considered him a personal friend, by sending them fictitious account statements showing annual rates of return of 7 to 20 percent,” the SEC said.

But Merriman “did not trade stocks and options after his first year of operations,” the SEC said.

Regardless, “he used millions of dollars in investor funds to support his lavish lifestyle and pay out withdrawals by other investors. He also offered ‘rebates’ to existing investors to entice them to invest additional money with him.”

Merriman also bought “classic cars, motorcycles, motor homes, a cabin in Idaho and fine art collections, including works by Rembrandt that are worth millions of dollars,” the SEC said.

Partial list of art seized by prosecutors in Shawn Merriman Ponzi case.

Among Merriman’s cars seized by prosecutors were an Aston Martin and a 1930 Lincoln. Prosecutors also seized at least 34 firearms, along with taxidermy. One of Merriman’s pastimes was safari.

Prosecutors said Merriman operated his scheme for 15 years before it collapsed. He once was a Mormon bishop.