Prince George's Man Convicted In A $28M Ponzi Scheme Is Headed To Prison

PRINCE GEORGE'S COUNTY, MD — A 42-year-old Upper Marlboro man has been sentenced to prison for his involvement in a $28 million Ponzi scheme involving 1st Million, a wealth management and financial literacy company.

John Erasmus Frimpong has been sentenced to nine years and six months in federal prison, followed by three years of supervised release for conspiracy to commit wire fraud, conspiracy to commit securities fraud and securities fraud. He and his co-defendants must also pay about $16.6 million in restitution for the full amount of the victims’ losses relating to the 1st Million scheme.

Frimpong must also pay $797,775 for the losses caused by his separate scheme in which he contracted directly with individual victims claiming to invest on their behalf.

According to his plea agreement, Frimpong and his co-conspirators operated a Ponzi scheme through a Delaware incorporated business named The Smart Partners LLC, doing business as 1st Million LLC or 1st Million Dollars.

As detailed in the plea agreement, Frimpong and his co-conspirators fraudulently solicited more than $28.3 million from about 1,200 victims across the United States, including in Maryland, Texas, Florida, New York and Georgia.

Frimpong admitted he made false and misleading representations to potential investors about the nature and safety of the investments in 1st Million, the rates of return and the experience, training and licensure of 1st Million and its principals, prosecutors said in a news release.

Instead, Frimpong and the others never invested the money, never placed it in a trust account and 1st Million ended up with substantial cash flow problems, according to court documents.

That prompted Frimpong to start his own separate scheme with the same false promises. He instead used hundreds of thousands of dollars in fraudulently obtained investments to pay for his own lifestyle.