Barrington Man Charged In $105 Million Investment Scheme

A Barrington man was charged Thursday with eight counts of mail fraud for allegedly stealing more than $105 million from hundreds of victims in an investment fraud scheme.

Federal prosecutors said Daniel Spitzer, 51, sold memberships and limited partnership interest in 12 investment funds known as the “Kenzie Funds.”

Spitzer allegedly told about 400 investors that their money would be used in foreign currency trading. He also told them the Kenzie Funds had never lost money, and misrepresented the funds' return rates, according to prosecutors. While Spitzer allegedly told investors that profits ranged from 4.52 percent to 13.54 percent over a five-year period, prosecutors said bank accounts indicate the total net return on investments during that time was less than 1 percent.

Prosecutors alleged that Spitzer used a significant portion of the money given to him by investors in a Ponzi scheme to pay off earlier investors. Authorities said less than a third of the $105 million given to him was ever invested in the Kenzie Funds.

The charges followed a joint investigation by the U.S. Postal Inspection Service and the FBI.

Spitzer will be arraigned in the U.S. District Court. If convicted, he could face up to 20 years in prison and $250,000 fine for each count of mail fraud. The government is also seeking $34 million in compensation from Spitzer.  That total is comparable to the amount of loss to the alleged victims.