Former NFL Linebacker Sentenced to Prison for Multi-Million Dollar Ponzi Scheme
John Robert Leake, a former NFL linebacker who once graced the fields for the Atlanta Falcons and Green Bay Packers, has been sentenced to two and a half years in federal prison. The sentence, handed down this week, follows Leake’s admission to orchestrating a Ponzi scheme that defrauded friends and acquaintances of millions of dollars. The elaborate scheme involved purported investments in West African gold mines, real estate ventures in Central America, and other enticing opportunities, all of which ultimately proved to be a web of lies designed to fuel Leake’s gambling addiction.
The U.S. Attorney’s Office for the Central District of California presented a compelling case against Leake, detailing how he preyed on the trust of those closest to him. According to court filings, Leake’s deception was "bald-faced," and he "lied to those who considered him a friend, convinced them to invest in business opportunities that were largely non-existent, and used their funds to either pay his personal expenses, or pay back those he had already stolen from in an effort to keep his scheme afloat."
Leake, now 43, managed to swindle his victims out of a staggering $5 million over a period of five years. In September, he pleaded guilty to one count of wire fraud and one count of transactional money laundering, acknowledging his role in the fraudulent enterprise.
U.S. District Judge John F. Walter presided over the sentencing hearing on Monday, delivering not only the prison term but also ordering Leake to pay $5 million in restitution to the six victims who fell prey to his scheme.
Leake’s attorney, Evan J. Davis, attributed his client’s actions to a gambling addiction, stating that Leake "committed these crimes based largely on his being a gambling addict and he feels terrible about deceiving his friends to fuel that addiction." Davis expressed hope that Leake’s participation in treatment programs would mark a turning point in his life.
Before his descent into criminal activity, Leake enjoyed a successful football career. He played for Clemson University from 2000 to 2003, contributing to the team’s victory in the 2003 Peach Bowl. In 2004, he was signed as an undrafted free agent by the Tennessee Titans. The following year, he joined the Atlanta Falcons and Green Bay Packers, ultimately resigning from the Falcons in 2006, his final season in the NFL.
The details of Leake’s Ponzi scheme paint a picture of audacious deceit. He enticed investors with promises of lucrative returns from gold mines in Ghana and Alaska, real estate deals in Southern California, Costa Rica, and the Middle East. Between 2015 and 2020, he convinced six individuals, consisting of friends and mutual acquaintances, to invest over $8 million in his supposed projects. While a portion of the money was indeed invested, more than $5 million was diverted for Leake’s personal benefit, funding his gambling habits, covering personal expenses, and making payments to earlier victims to maintain the illusion of a legitimate investment.
Prosecutors revealed that Leake used the stolen funds to pay credit card bills, car payments, and rent. The operation adhered to the classic structure of a Ponzi scheme, where returns to investors are not generated from legitimate business activities but rather from funds contributed by newer investors. This creates a pyramid-like structure, with those at the bottom funding the profits of those at the top.
While court filings refrained from naming Leake’s victims, they were described as friends and mutual acquaintances. The first victim believed he was investing in gold mines in Ghana and Alaska, as well as other financial products. Although a small portion of the $1.7 million he invested did go towards gold mines, the financial product schemes were entirely fictitious, with over $1 million ending up in Leake’s possession. The two individuals had met through mutual friends around 2014.
The second victim, a friend of Leake’s, was lured into the scheme along with his father and two acquaintances. Leake pitched investments in luxury real estate ventures in Los Angeles and Costa Rica. The plan in California involved Leake using the funds to cover years’ worth of rent on luxury homes, which would then be sublet at a higher rate, with the profits going to the investors.
Leake took over $1 million from this victim, but the properties never existed. The same friend also provided Leake with $600,000 to invest with a "prominent billionaire" whom Leake falsely claimed to do business with. Additionally, Leake defrauded the friend of around $500,000 under the guise of investing in "the Costa Rica property," providing forged contracts and checks but never sending the funds to the purported developer.
Over a period of two years, the friend lost approximately half of his investment. Leake repaid the remaining amount using payments from other victims, including two investors whom Leake had met through the friend.
The final victim, whom Leake met at a dinner with friends, suffered the greatest loss, amounting to $2.8 million. Leake used this money to pay the other victims, rather than investing in properties in Dubai as he had promised.
In a letter to Judge Walter, Leake described the moment he realized the severity of his actions and the consequences he faced.
"I fell to my knees, sobbing, and began to reflect on all the unforgettable actions I had caused my friends over the years," Leake wrote. "I understand the seriousness of my actions and the impact they have had on the six victims I have hurt. I deceived my friends by lying and fabricating reasons for taking money from them."
Following his indictment, Leake checked into a mental health clinic in Houston for approximately 60 days. During his time at the clinic, he participated in Alcoholics Anonymous and groups for gambling and narcotics.
Leake claims to have taken steps to address his addiction, including deleting gambling apps from his phone and severing ties with bookies, casino hosts, and friends from gambling circles. He also credited two books, "Make Your Bed" by Admiral William H. McRaven and "Atomic Habits" by James Clear, with helping him manage his addiction.
Leake expressed his desire to speak at an addiction conference in April and to return to work at the clinic after serving his sentence. He also emphasized his commitment to repaying his victims.
"It is important to me to start paying back all six victims," he wrote in the letter.
The case serves as a stark reminder of the devastating consequences of Ponzi schemes and the importance of exercising caution when considering investment opportunities, especially those that seem too good to be true. The fact that Leake exploited the trust of his friends and acquaintances makes his actions all the more reprehensible.
