Adviser gets 12 Years in Prison in Ohio Fraud Case

July 8, 2008 9:54:37 AM PDT
An investment adviser has been sentenced to 12 years in prison on fraud charges related to the loss of $216 million in a hedge fund at the Ohio agency for injured workers. Mark Lay, chief executive and founder of the now defunct MDL Capital Management of Pittsburgh, had faced a maximum sentence of 27 years.

U.S. District Judge David D. Dowd Jr. in Akron sentenced Lay on Tuesday after the second day of a lengthy sentencing hearing.

The Ohio Bureau of Workers' Compensation was the sole investor in a high-risk hedge fund Lay set up in Bermuda. Prosecutors said he failed to tell bureau officials about the extent of the risk.

Lay was the 19th person convicted in a wide-reaching corruption scandal in Ohio that began in 2005.