Wisconsin investment fraud, Braeger sentenced to federal prison
Milwaukee Federal Building & U.S. Courthouse
MILWAUKEE - A Wisconsin man has been sentenced to two years in federal prison for what prosecutors said was a fraud scheme that lost investors more than $2.5 million. He was also ordered to pay restitution.
According to court records, industry regulators previously barred 57-year-old David Braeger of Fox Point from serving as a broker or associating with a broker-dealer firm. In 2017, he opened "Blue Star Automotive Fund" and sold limited partnership shares to 27 investors for a total of $5.4 million.
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The U.S. Attorney's Office said Braeger told investors the money would be used to fund a car dealership and, while he gave about half of it to the dealership, he misappropriated more than $2.5 million "in ways contrary to his representations."
Braeger spent the victims’ money on his own living expenses – including, but not limited to, the purchase of several luxury vehicles and personal legal fees – according to federal prosecutors. He also used the victims' money to buy a restaurant in Glendale, sponsor a NASCAR driver and buy cryptocurrency.
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The U.S. Attorney's Office said, in addition to the "Blue Star" scheme, Braeger stole $100,000 from an investor as part of a different venture in which he claimed the money would be used to fund litigation but instead spend it on personal use.
At sentencing, U.S. District Judge Lynn Adelman said Braeger was motivated by "greed and self-aggrandizement."