U.S. Attorney's Office
Northern District of California
(415) 436-7200
January 15, 2015

Partner in Scotts Valley Investment Company Sentenced to More Than 10 Years in Prison for His Role in Fraud Scheme

SAN JOSE—Christopher Luck was sentenced yesterday to 130 months in prison, and ordered to pay $33,222,148.82 in restitution for his role in a securities fraud, announced United States Attorney Melinda Haag and Federal Bureau of Investigation Special Agent in Charge David J. Johnson.

Luck pleaded guilty on July 21, 2014, to one count of conspiracy to commit mail and wire fraud, one count of mail fraud, and one count of securities fraud. According to the plea agreement, Luck admitted that he made false and misleading statements to investors in order to cause them to invest in the GLR Growth Fund, an investment fund managed by his investment company, Geringer, Luck, and Rode LLC. Luck admitted that at the end of April 2009, his partner, John Geringer confessed to Luck that Geringer had been falsifying the Growth Fund’s trading records for several years. Instead of terminating the Growth Fund, or reporting Geringer to the authorities, Luck admitted that he began to recruit investors by making false and misleading statements to them, including that the Fund had a positive historical performance, and that the Fund made diversified equity trades.

Through his guilty plea, Luck acknowledged that these false and misleading statements to investors were necessary in order to cause new investors to invest and existing investors to maintain their investments or invest more money. Luck admitted that if he was truthful with potential investors after Geringer’s confession, new investors would most certainly choose not to invest, and that new investor money was critical to keeping the Growth Fund afloat. Luck also admitted that this new investor money was used to pay Luck’s salary and bonus payments. In total, from May 2009 through the end of the Growth Fund in 2012, Luck defrauded investors out of over $33 million.

Luck, 58, of Scotts Valley, California, was indicted by a federal grand jury on December 20, 2012. He was charged with conspiracy, mail, wire, securities fraud, and money laundering, all related to his fraudulent conduct at Geringer, Luck, and Rode, LLC.

The sentenced was handed down by the Honorable Judge Edward J. Davila, U.S. District Court Judge, following a guilty plea to one count of conspiracy to commit mail and wire fraud, in violation of Title 18, United States Code, Section 1349; one count of mail fraud, in violation of Title 18, United States Code, Section 1341; and one count of securities fraud, in violation of Title 15, United States Code, Sections 78j(b) and 78ff, and Title 17, Code of Federal Regulations, Sections 240.10b-5 and 240.10b5-2. Judge Davila also sentenced the defendant to a three year period of supervised release, ordered the defendant to pay restitution in the amount of $33,222,148.82, and forfeit $33,222,148.82 to the United States government. The defendant will begin servicing the sentence on April 9, 2015.

Jeff Schenk is the Assistant U.S. Attorney who is prosecuting the case with the assistance of Nina Williams and Laurie Worthen. The prosecution is the result of an investigation by the Federal Bureau of Investigation.

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