Gary Snisky of Longmont pleads guilty to mail fraud, money laundering

DENVER – Gary Snisky, 48, of Longmont pleaded guilty Thursday in U.S. District Court to charges of mail fraud and money laundering.

Snisky’s co-conspirator, Richard Greeott, pleaded guilty to the same charges Oct. 7, 2013. Greeott will be sentenced April 24, and Snisky will be sentenced June 18.

The net loss Snisky caused to investors in a bogus bond and futures trading program was $5.2 million. To date, as a result of asset forfeiture proceedings, victims are in the process of being paid restitution in the amount of $2,695,913. The remaining amount of restitution is $2,531,052, most of which is jointly liable between Snisky and Greeott.

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Snisky pleaded to one count of mail fraud, which carries a penalty of not more than 20 years in federal prison, and a fine of up to $250,000; one count of money laundering, which carries a penalty of not more than 10 years in federal prison, and a fine of up to $500,000.

According to court documents, Snisky operated Colony Capital in Colorado, which purported to be a private-equity firm offering investment opportunities in bonds, futures trading, and other offerings.

In 2011, Snisky shut down Colony Capital and formed Arete in Longmont, which operated in a similar manner.

Beginning in late 2009, as a paid independent contractor, Greeott began developing a website for Colony Capital.

In 2010, Snisky asked Greeott to develop an automated trading system for trading in the futures market, particularly an algorithm.

Snisky falsely led investors, potential investors and financial advisers to believe the algorithm was being used by Colony Capital, and later Arete, to profitably trade in the futures market in order to falsely bolster their appearance of success and overall financial stability.

In 2011, Greeott believed that he had developed an algorithm for trading in the futures market that he tested in a simulated environment for several months.

Eventually, Greeott began testing the algorithm by trading small amounts of money in small, but real, futures contracts. At all times, the algorithm was still in a developmental phase. At no time did anyone at Colony Capital or Arete trade a significant amount of money or make any real profit.

Between July 2011 and January 2013, Snisky falsely led investors, potential investors and financial advisers to believe that they were trading “live” in the futures markets and that they had a history of trading profitably in the futures market.

Also, from July of 2011 through January 2013, Snisky offered investors a “proprietary value model,” which was based on using the investors’ money to purchase Ginnie Mae bonds.

Throughout 2012, Snisky continued to make false assurances about the safety of investing in the bond program despite the fact that Snisky had not purchased any Ginnie Mae bonds as promised.

This case was investigated by the Internal Revenue Service, the Federal Bureau of Investigation and the United States Postal Inspection Service.