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Ponzi scam artist who duped investors out of $100M escapes from federal prison

December 11, 2017  |  Posted by: Francesca Falzarano
Ponzi scam artist who duped investors out of $100M escapes from federal prison

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A Ponzi scam artist who duped investors out of over $100 million broke out of a federal prison in California.

Frederick Darren Berg, 55, was serving 18-years for wire fraud, money laundering, and bankruptcy fraud at the U.S. Penitentiary Atwater Satellite Prison Camp. However, when corrections officials checked on the man at 3:30 p.m. on Wednesday, he was nowhere to be found.

Merced County Sheriff Vern Warnke said in an interview with the Merced Sun-Star that his unit has a “be on the lookout” notice for the fugitive.

“We offered assistance, but they assured us he was already out of the area,” Warnke said.

Prison officials did not reveal how Berg broke out. They did say they do not think he’s in the area.

Frederick Darren Berg, shown here in a 2016 mugshot photo, escaped from federal prison in California last week

SeattlePI reported that Berg was responsible for the most significant financial Ponzi scam in the history of Washington state when he stole $120 million from over 800 investors over a ten-year period.

In 2012, he was found guilty and was sentenced to 18 years behind bars.

“This defendant stole and squandered dreams of retirement, dreams of homeownership, dreams of a college education for their children and grandchildren,” U.S. Attorney Jenny A. Durkan said after the conviction.

Berg’s story of corruption and luxury was described in CNBC’s American Greed last year. The episode portrayed Berg as a cocksure spendthrift who owned two yachts and a place, along with expensive real estate in Seattle.

“I’m having fun in this economy…There’s nothing more fun than being right,” he said in a video pitch to investors in 2009.

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