RICHMOND, VA (WWBT) – Donald Lacey was a Henrico County police officer for 10 years before switching to real estate. He promised investors big returns on a house flipping business, but instead ran a ponzi scheme that bilked more than 170 people out of millions.
Donald Lacey left the courthouse with ten years - one month hanging over his head. Federal Judge Henry Hudson said Lacey tarnished the badge he once wore. Hudson called Lacey's ponzi scheme "appalling" because Lacey used his reputation as a former police officer to cheat people out of millions. People like Michael Frye.
"That was the whole point of this whole thing. People trusted him. We never looked at what he was doing as well as we should have because he was a former Henrico County police man," said Frye.
In court Lacey apologized and said he never intended to hurt anyone.
"We're working on trying to find ways to get as much of this restitution paid as possible," said Lacey's attorney Jeffrey Everhart.
Frye is fighting throat cancer, and considered Lacey a good friend. He says Lacey took him to his chemo sessions just before the scheme collapsed.
"Five of my very, very close friends took turns. Taking me to...taking me to radiation and Don was one of those. And then he actually took money from me. My company, two weeks later," said Frye.
Prosecutors say Lacey put very little of the money back into the properties, often spending it on his lavish lifestyle which consisted of five homes, boats, and cars. Millions also went to pay interest to other investors.
"It's the people that had retirement money that he took their money and to me, that's the saddest part because they're older and they can't…they don't have a chance to recover," Frye said.
Lacey must report to prison on September 20. When he gets out he'll be on supervised release and cannot get a credit card or mortgage without permission from his probation officers. A judge will decide how much Lacey must repay his victims in September.