A federal judge sentenced a Kansas lawyer to nearly four years in prison for operating a Ponzi scheme that bilked investors out of more than $2 million. Clifford R. Roth, 62, was sentenced by United States District Judge Marcia Crone to forty-six months in prison and ordered to pay over $2 million in restitution to defrauded investors. Roth pled guilty earlier this year to an information charging him with interstate transportation of money taken by fraud.
Roth, a licensed attorney in Kansas, traveled to Beaumont, Texas, in November 2007 and began soliciting investors to finance the purchase of bank holding company stock, which in turn would purchase an Oklahoma bank that would open a branch in Beaumont. Investors were promised that their stock purchases would be held in escrow until the bank purchase was completed, and in the event the bank purchase did not occur, investors would receive their initial investment along with accrued interest. As a result of these misrepresentations, dozens of investors contributed a total of $2.5 million to Roth. Yet, according to the FBI, Roth never acquired a bank. Instead, Roth misappropriated investor funds to a company he controlled to pay personal expenses and make payments to previous unrelated creditors of Roth.
Roth, once a name partner at Kansas City law firm Gaar Buxbaum & Roth, has been ordered to begin serving his sentence by August 23, 2011.