The name Gerard Cellette may soon go down in history alongside the likes of Tom Petters and Denny Hecker because the new case against him could label him the biggest scam artist in Minnesota's history.
Cellette, 48, lied to investors -- and he admits it, explaining that he told victims across the country that he had a can't-miss opportunity.
From Minnesota to California and off the coast to Hawaii, 55 people bought into Collete's $150-million Ponzi scheme.
Cellette, who was already serving a six-year sentence in a Minnesota prison over securities fraud, was flown in handcuffs to Orange County, Calif., on Tuesday. By Wednesday morning, he was charged in what prosecutors described as the largest Ponzi scheme they had ever seen.
Officials say about $152 million flowed to Cellette from Orange County, and he allegedly did it without ever stepping a foot in the state.
Instead, officials say Cellette conducted his scheme from the safety of the lavish home he once owned in Andover, which boasted an indoor swimming pool. From there, he ran a company he called Minnesota Print Services, Inc., and he claimed to have large printing contracts with major corporations and was seeking investors for projects that never existed.
Prosecutors claim Cellette sat in his home office inside his carriage house and spun elaborate tales over telephone, telling investors they could expect a 15 percent return. To keep up the ruse, he needed a constant supply of new investors to pay back the old ones -- but prosecutors say that's a game of musical chairs that ends when the money dries up.
That happened three years ago for Cellette, which is when Hennepin County prosecutors charged him with securities fraud involving half a dozen victims and a loss of about $50 million.
Before the charges came down, prosecutors say Cellette was living large -- he had a dozen homes, a fleet of fancy cars and always traveled by private jet. He even gave $2 million to Mac Hammond's megachurch, Living Word.
California, Hawaii and Minnesota weren't the only states struck by the scam. Of the 55 victims, some are in Georgia, Arizona, Colorado, and Illinois as well. So far, prosecutors say Cellette has been cooperating in the investigation.
In all, Cellette is facing 116 felony counts -- including 46 counts of selling unregistered securities, 43 counts of money laundering, and 27 counts of using an untrue statement in the purchase and sale of a security. If convicted on all counts, he faces a maximum sentence of 104 years in prison.
Currently, Cellette is being held on $21 million bail. He must prove the money is from a legal and legitimate source if he is to post bond.
WHBQ-TV | Fox 13
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