An Oregon politician was sentenced to six years in prison on Monday for fraud in connection with last year’s Facebook IPO.
Craig Berkman, a former Republican candidate for governor in 1994, convinced investors he had access to shares of Facebook before the social networking company’s initial public offering. Berkman told the investors he could use their money to buy pre-IPO shares of the company, as well as shares of other companies like LinkedIn and Groupon, CNBC reports. But Berkman was using the money from more recent investors to pay off earlier investors and to pay a $6 million settlement with a firm that had accused him of failing to pay debts.
Berkman pleaded guilty in federal court in June to securities and wire fraud. In addition to his six-year sentence, he will forfeit the more than $13 million he raised in his dealings.