A man wanted for his role in an alleged $35 million Ponzi scheme was arrested Monday after evading FBI agents by swimming into California’s largest reservoir using an underwater “sea scooter,” federal prosecutors said.
Matthew Piercey spent nearly 30 minutes in frigid Lake Shasta using the Yamaha 350Li submersible device before he eventually resurfaced and was handcuffed, the Sacramento Bee reported. It wasn't immediately known if the 44-year-old has an attorney.
When agents went to arrest Piercey, he hopped in a pickup and led them on a chase that ended at the shoreline of the lake north of Redding.
“Then, Piercey abandoned his truck near the edge of Lake Shasta, pulled something out of it, and swam into Lake Shasta,” federal prosecutors wrote in court documents calling Piercey a flight risk. “Piercey spent some time out of sight underwater where law enforcement could only see bubbles."
Agents later learned Piercey had a sea scooter, a motorized device that pulls users underwater at speeds of about 4 miles per hour, the newspaper said.
Last week, a grand jury indicted Piercey and his business partner, Kenneth Winton, 67, of Oroville, the Bee reported.
Piercey is accused of bilking investors into giving $35 million to his companies, Family Wealth Legacy and Zolla, promising guaranteed returns using an “Upvesting Fund” that allegedly was an algorithmic trading fund with a history of success, prosecutors said.
Piercey allegedly admitted privately to an associate that there was no Upvesting Fund, prosecutors said. Piercey originally recruited Winton as an investor, but Winton eventually took on management responsibilities at Zolla.
They used some investor money for various business and personal expenses, including two residential properties and a houseboat. Few, if any, liquid assets remain to repay investors, prosecutors said.
Piercey faces charges including wire fraud, mail fraud, money laundering, and witness tampering. His arraignment is scheduled for Tuesday. Winton, who has been charged with conspiracy to commit wire fraud, has an initial court appearance on Thursday.
If convicted, both Winton and Piercey face 20 years in prison and hundreds of thousands of dollars in fines.
Winton's attorney, Adam G. Gasner, told the Bee his client "looks forward to the judicial process shedding light on what actually occurred here.”