A former OneAmerica Securities Inc. representative who is already serving five years in federal prison for running a Ponzi scheme received a much tougher sentence Thursday in a local courtroom.
Jerry A. Smith was sentenced to serve 20 years in prison and 20 years on probation, and make $410,189 in restitution. He was charged with five Class C felonies for the sale of unregistered securities.
Prosecutors said Smith, along with Jasen Snelling of Cincinnati, Ohio, sold the securities in Franklin and Dearborn Counties through City Fund Advisory and Dunhill Investment Advisories Ltd. The pair were not registered to sell securities nor did they register any of the securities sold as required by Indiana law.
Federal prosecutors said investors were promised returns of 10 percent to 30 percent, and often dug into retirement accounts to invest, but Smith and Snelling spent most of the money on their personal expenses such as credit cards, mortgages, vacations, vehicles and plastic surgery.
Smith, who entered into a plea agreement, was ordered in 2013 to spend 65 months in federal prison and pay $5.4 million in restitution for helping orchestrate the Ponzi scheme in Ohio, Kentucky and southeastern Indiana.
Snelling, who also reached a plea agreement with federal prosecutors, was sentenced to 10 years in prison and ordered to forfeit $5 million and pay another $5.3 million in restitution.
Smith will serve his new prison time concurrently with the federal sentence.
“Smith’s actions were deplorable and I’m pleased we were able to add additional jail time to his sentence,” said Secretary of State Connie Lawson in a written statement. “He took advantage of people who knew and trusted him."
In October, OneAmerica Securities Inc. agreed to pay the state $805,000 to settle allegations it failed to supervise Smith, who was their registered representative. The Indianapolis-based company did not admit to any liability in the agreement with the Indiana Securities Division, which plans to distribute the settlement funds to victims of the fraud who agree to sign a release agreement in favor of OneAmerica.
OneAmerica said it agreed to the settlement "to avoid the expense and uncertainty of litigation and the potential impairment of its goodwill."