Man pleads guilty to fraud

A Kooskia, Idaho, man has pleaded guilty in U.S. District Court to four criminal counts of mail fraud in connection with a Ponzi scheme that cost investors more than $1.5 million.

In the related civil complaint, the U.S. Securities and Exchange Commission said Steven Tennies, 51, told investors his company, Price Geld & Company Inc., would guarantee an “absolute positive return” no matter the business cycle by using their money to buy limited partnerships in the Aldeona Fund.

Opened in 2003, by 2007 the fund had become a Ponzi fraud that paid early investors with money raised from new investors. Tennies, meanwhile, diverted money for personal expenses, including a $400,000 divorce settlement and the purchase of rare books.

He collected more than $2.3 million from at least 34 investors, returning about $770,000.

The scheme collapsed in February, when investors confronted Tennies at his lavish home. He then turned himself in to Idaho authorities.

Tennies agreed to pay $1.7 million in restitution to resolve the SEC charges.

He will be sentenced on the criminal counts Oct. 19. The maximum penalty is 20 years for each count, plus three years of supervised release and a $250,000 fine, but a plea agreement with the U.S. attorney opens the way to lesser penalties.