2 Former Executives Guilty in Ponzi Scheme
Two former executives of a mortgage-lending firm pleaded guilty to federal charges for their roles in a massive Ponzi scheme that resulted in losses of more than $200 million for investors.
Keith Grubba, the former president of PinnFund USA, admitted that he conspired to deceive investors and filed false income tax returns. He faces up to 30 years in prison. Michael Trap, a former manager of a related company, admitted to lying to a federal grand jury. He faces up to five years in prison.
Carlsbad-based PinnFund collected investments for five years before being shut down by court order in March 2001. Investigators said that much of the money collected went to support the lavish lifestyle of Chief Executive Michael J. Fanghella.
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