Submitted by Chris Phillips on Thu, 02/23/2012 - 9:45pm.

CHARLOTTE, N.C. (AP) - The U.S. Attorney's Office in Charlotte says four hedge fund managers have been indicted in connection with a Ponzi scheme that bilked investors out of $40 million. It's the latest development in a case involving Black Diamond Capital Solutions. The indictment says the defendants lied to get money from their victims by claiming they were operating legitimate hedge funds with significant safeguards. But U.S. Attorney Prosecutor Anne Tompkins says as Black Diamond began collapsing, the defendants diverted the money. The company's founder, Keith Simmons, was convicted of securities fraud, wire fraud and money laundering in Charlotte in 2010. He is facing up to 80 years in prison. Six people also have already pleaded guilty to their roles in the fraud, which took place between October 2007 and April 2010. (Copyright 2012 by The Associated Press. All Rights Reserved.)

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