Prophecy Fund Collapse Leading to More Guilty Pleas, US Says (1)

A prosecutor said more people will plead guilty over the 2020 collapse of Prophecy Asset Management, which the US says cost investors $294 million.

The disclosure came at a federal court hearing Wednesday to set a trial date for Prophecy executive Jeffrey Spotts, 58, who was charged last month with conspiracy and fraud in a four-count indictment.

Prophecy co-owner John Hughes pleaded guilty in November 2023 to conspiring to commit securities fraud at Prophecy and is cooperating with prosecutors. Others will admit their role in the fraud at Prophecy, a prosecutor told US District Judge Michael Shipp.

“There are ...