Leonard Adolph Delk, 80, of Los Osos, California and the owner of LAD Management Co. plead not guilty yesterday to eight felony counts of fraud, theft and embezzlement. Delk is charged with misappropriating $3 million in investment funds prosecutors allege he used for his own benefit. It is also alleged that he sold securities in a Ponzi scheme, promising returns as high as 23 percent per year and paid earlier investors with later investors' funds. Prosecutors also alleged that Delk spent investor money on personal credit cards, gas cards, membership fees in a flight club and restaurant and hospital bills. The scheme went on for at least 10 years, according to some reports. Delk was once a prominent citizen in the area, a practicing real estate attorney and having once served as the mayor of the City of Norwalk and an official in the Democratic Party. Nevertheless, we also note that Delk was accused of fraud while an attorney in Los Angeles County in the area of real estate and finance and had his law license suspended in 1985 as a result.Read the story here, here and here.
Update (10/13/10): Delk, now 82, pleaded no contest to grand theft by embezzlement and unlawful sales of securities and faces up to 10 years in prison.
Update (1/14/11): Delk was sentenced to 9 years in jail.
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