An Indiana man was sentenced to six years in state prison for defrauding investors out of $1.4 million in a Ponzi scheme. Randell E. Morrison, 55, also received two years of probation following the completion of his sentence, with the first year to be served under house arrest. Allen Superior Judge John Surbeck scoffed at Morrison's request to avoid prison to instead pursue a "business opportunity" that would purportedly allow him to make full restitution to investors in seven years, stating that “[w]e are our fooling ourselves to think we should put you on the streets to run another scheme to make restitution.”
Morrison was originally charged with seven counts of securities fraud and one count of corrupt business influence stemming from his sale of unregistered securities to investors. From September 2005 to August 2010, his company, Research & Development Management LP. ("R&D Management"), solicited victims to entrust their retirement assets and promised them a thirty percent annual return in exchange. Morrison refused to provide statements to victims for the duration of the scheme, only telling investors that they were "making money." In reality, Morrison used victim funds for business and personal expenses and failed to make investments as he promised.
A subsequent investigation by the Indiana Securities Division found that Morrison had failed to register R&D Management as a broker-dealer. He was apparently sued back in 2007 by an investor who sought the return of their investments, but the suit was dismissed when Morrison promised to repay the investors. When he fell behind on the repayment, the suit was re-filed.