A Key Biscayne man is due to be sentenced Wednesday for his operation of a Ponzi Scheme that caused investors losses of nearly $3 million. Lorn Leitman, 61, a lawyer and accountant, pled guilty to one count of mail fraud in connection with the scheme where investors were lured to the possibility of annual returns exceeding fourteen percent. He will face a sentence of at least twelve years in federal prison, and the federal judge overseeing the case, U.S. District Court Judge Donald Graham, has suggested that he may impose a higher sentence due to the severity of the crime.
Leitman is said to have operated the scheme for a decade, until incoming funds were no longer sufficient to pay interest to older investors. The scheme consisted of a home-loan investment deal, and ultimately over 25 investors would entrust nearly $3 million to Leitman. Even before Leitman is alleged to have started the scheme, he ran into trouble in the early-1990s in a similar capacity making loans to Florida investors. As a result of an investigation by the Department of Banking and Finance, Leitman was forced to surrender his broker's and registered investment advisor's license.
Additionally, Wednesday's sentencing is not Leitman's only legal problem. A South Florida grand jury recently returned an indictment charging Leitman with stealing from the South Florida Emergency Physicians, P.A. Profit Sharing Plan, an employee pension benefit plan. These new charges carry a maximum prison sentence of five years.