Accountant admits bilking ‘plain people’ out of $60M
A Bethel Township accountant who represented himself as a trusted member of a Mennonite church pleaded guilty Feb. 27 to running one of the largest Pennsylvania-based Ponzi schemes, U.S. Attorney William M. McSwain announced in a news release.
Philip E. Riehl, 68, pleaded guilty in federal court in Philadelphia in the Eastern District of Pennsylvania to conspiracy and fraud charges related to a scheme he operated that was worth approximately $60 million.
The fraud targeted members of the Mennonite and Amish religious communities in Pennsylvania and elsewhere, officials said.
Riehl was charged in January with one count each of conspiracy to commit securities fraud and wire fraud, one count of securities fraud, and one count of wire fraud. Riehl solicited tens of millions of dollars in investments from his accounting clients and others and placed them into an investment program that he operated, the U.S. Attorney’s office said.
The scheme started around 2010, when Riehl took funds from the investment program he was operating to prop up his Franklin County-based creamery, Trickling Springs Creamery, and paid earlier investors with the take from later investors, officials said.
Trickling Springs Creamery announced it was ceasing operations in September and filed for bankruptcy in December.
The estimated $60 million loss is shared among hundreds of members of the relatively small Mennonite and Amish community in the Bethel area, McSwain said during a press conference last month in the Madison Building at Fourth and Washington streets, Reading.
“Riehl’s victims trusted him to handle their investments with honesty and integrity,” said McSwain. “Instead, he took advantage of their trust based on their mutual religious affiliation.”
Riehl was a member of Little Mountain Mennonite Church just inside the county line near Fredericksburg, Lebanon County.
Separate from the federal action, the Pennsylvania Department of Banking and Securities proposed civil penalties against Riehl totaling $4.375 million, believed by officials to be the largest such penalty in department history.