Report: Rockville Man Indicted in Alleged Ponzi Scheme

A Rockville man was indicted in an alleged Ponzi scheme that bilked more than $25 million from investors, NBC4 reports.

Garfield M. Taylor, 54, was indicted Feb. 21 and has entered a plea of not guilty, according to NBC4.

Click here to read the full story on NBCNews.com.

In 2011, the Securities and Exchange Commission charged Taylor—a former employee of mortgage giant Fannie Mae—and several family members with conducting a multimillion-dollar Ponzi scheme in the Washington metropolitan region, including in Montgomery County, according to the SEC complaint filed in federal court.

According to the SEC’s allegations, the scheme defrauded 130 investors of more than $25 million between 2005 and 2010. Taylor and his family lured people with little-to-no investing experience to invest in promissory notes issued by Taylor's two companies, which engaged in purportedly low-risk options trading, the complaint said.

But Taylor and his companies engaged in high-risk, speculative options trading and suffered massive losses. Money from new investors was used to pay returns to earlier investors, according to the complaint. 

The SEC says Taylor also used $5 million in investor funds to pay family and friends and for other personal uses, including $73,000 to the private school his children attended.