THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Thursday, March 2, 1995 TAG: 9503020520
SECTION: LOCAL PAGE: B4 EDITION: FINAL
SOURCE: STAFF REPORT
DATELINE: NEWPORT NEWS LENGTH: Short : 33 lines
A Hampton man was indicted in federal court Wednesday on charges of defrauding at least 11 investors of about $628,000 since 1989.
A grand jury charged Salomon S. Loayza, 39, with six counts of mail fraud, court records show. Loayza owns three investment companies on the Peninsula: Colonial Capitol Resources Inc. and Salomon, Roberts and Company Inc., both of Hampton; and Provident Capital Management, of Newport News. FBI agents arrested him without incident Wednesday in a Hampton restaurant.
According to the indictment, Loayza promised investors that their money would be invested in nationally known mutual funds and then returned, with interest, after a specified period.
Instead, Loayza used the money to pay off his and others' personal and business expenses, the indictments said. To make it appear that their investments were doing well, Loayza allegedly used the funds of new investors to make periodic interest payments to earlier investors.
The scheme lasted from March 1989 to December 1993, court papers said. With the exception of some early investors receiving a small portion of their investments back in the form of the bogus interest payments, Loayza's clients lost their money, court records claim.
KEYWORDS: GRAND JURY FRAUD by CNB