Investigators say man targeted Amish, Mennonite community in $60 million Ponzi scheme
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BERKS COUNTY, Pa. (WPMT) — The 68-year-old owner of a Franklin County creamery has been charged with conspiracy, securities fraud, and wire fraud after the investigation of a Ponzi scheme that allegedly targeted members of the Mennonite and Amish community, bilking them out of about $60 million.
Philip Elvin Riehl, of Berks County, is accused of fraudulently soliciting tens of millions of dollars in investments from his accounting clients and others into a bogus investment program he operated, according to the office of U.S. Attorney William M. McSwain, who announced the charges.
Riehl then diverted the funds to Trickling Springs Creamery, LLC, a Chambersburg-based creamery he owned the majority stake in. He also fraudulently solicited direct investments into the creamery, making material misrepresentations about the safety and security of the investgments in his program and about the program’s performance, “as well as misrepresentations and omissions about the creamery’s business and financial condition,” McSwain said.
The conspiracy “is one of the largest Pennsylvania-based alleged Ponzi schemes in history,” according to McSwain.
Trickling Springs Creamery announced it was ceasing operations in September 2019 and filed a bankruptcy petition in December 2019, McSwain said.
The allegations constitute what is sometimes referred to as “affinity fraud,” which typically involves investment scams that prey upon members of identifiable groups, such as religious or ethnic communities, McSwain said. These types of scams “exploit the trust and friendship that exist in groups of people who share common interests or beliefs” he said.
Most of the victims in Riehl’s alleged scheme were members of the Mennonite or Amish communities, investigators allege.
“(They) wanted a safe and secure investment, operated within their community and in a manner consistent with their religious principles,” Riehl said.
Riehl is a Mennonite, investigators say.
“These investors were looking for honesty and integrity when deciding where and with whom to invest their money,” said McSwain. “According to the Information, Riehl presented himself as a trusted member of their religious community, only to betray that trust and swindle them out of tens of millions of dollars. It is only natural for members of a tightly knit community to want to take care of one another, but Riehl did not care about anyone but himself.”
If convicted, Riehl faces a maximum possible sentence of 45 years in prison, a $5,500,000 fine, a three-year term of supervised release, forfeiture, and mandatory restitution.
The case was investigated by the Federal Bureau of Investigation, and is being prosecuted by Assistant United States Attorney Michael J. Rinaldi.
The Pennsylvania Department of Banking and Securities, and the U.S. Securities and Exchange Commission assisted in the investigation.
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