A Princeton couple defrauded millions of dollars from investors in their “social circle” within the borough to fund a lavish lifestyle including country clubs, an Antigua vacation, and summer camp and private schools for their child, according to a suit filed Tuesday by the state’s Bureau of Securities.
Ford and Katherine Graham, both of Princeton, raised $5 million through loans between January 2012 and January 2014, including $1.9 million of unregistered securities, Attorney General Gurbir Grewal said.
Katherine lured investors into a Ponzi scheme by falsely claiming the unregistered securities were “low-risk, high-reward investment opportunities in gas and oil projects,” Grewal said.
The couple set up four companies: Specialty Fuels Americas LLC; Aries Energy Group Venture LLC; CCC Holdings LLC; and Rattler Partners LLC. Money was transferred to the bank accounts of those companies as well as an account for Vulcan Energy International LLC – controlled by Ford – to withdraw the money.
Both defendants also used the money to pay previous investors in the Ponzi scheme, Grewal said.
The bureau, in its suit, is seeking civil penalties on the couple, restitution of all the money to investors, and that the couple be permanently barred from the state’s securities industry.
“Ford Graham and his wife allegedly used their social connections in the affluent Princeton community to lure investors into a Ponzi scheme that financed the defendants’ posh lifestyle of country clubs, private schools, and tropical vacations,” Grewal said in the Tuesday statement.
“The bureau’s action today seeks to hold the defendants accountable for their actions and require them to return the ill-gotten funds to defrauded investors,” Grewal added.