Politics & Government

Ex-Chief of Los Alamitos National Guard Base Stole Millions in Ponzi Scheme

Seventy-year-old Timothy Melvin Murphy promised to invest money clients sent him but instead spent it on himself.

A former commanding officer of the National Guard base in Los Alamitos pleaded guilty today to orchestrating a Ponzi scheme that ripped off 28 victims to the tune of about $2.7 million.

Timothy Melvin Murphy, 70, of Orange, pleaded guilty to one count of mail fraud, according to Assistant U.S. Attorney Rob Keenan.

Murphy was the commanding officer of the Los Alamitos base in the 1980s, but retired from the National Guard in 2006, the prosecutor said. Murphy met some of his victims through his military service, Keenan said.

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Murphy used his business, Capital Investors Inc., to dupe clients into giving him money that he promised to invest in various companies but instead spent mostly on himself, Keenan said.

The maximum sentence would be 20 years in federal prison, but sentencing guidelines call for 10 to 14 years, Keenan said.

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It was also expected that U.S. District Judge David O. Carter, who accepted Murphy's guilty plea, will order the defendant to pay restitution, Keenan said. It's unclear how much restitution Murphy could make, but the defendant owns a home and has collectible cars, the prosecutor said.


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