DENVER, Aug. 20 (UPI) -- A former Mormon bishop who allegedly acknowledged running a $20 million Ponzi scheme was formally charged with fraud in Denver and arrested, officials said.
Shawn Merriman's alleged victims clapped as federal marshals handcuffed him Wednesday following a hearing, The Denver Post reported.
Merriman, 46, entered a not guilty plea. But the newspaper said he is believed to have negotiated an agreement with federal prosecutors to plead guilty and forfeit assets to repay some of the money he allegedly stole.
"It's good to see him in those handcuffs -- he's hurt a lot of people," said Eileen Carpenter, a former friend who knows many of the alleged victims.
Merriman's lawyer, Patrick Ridley, said the defense agrees his client will be spending time in prison. But he said Merriman lost a lot before he was jailed, including his house, his wife and children, his collections of art and antique cars and his status in the Mormon Church, which has excommunicated him.
Investigators say Merriman used his connections for 15 years in a classic Ponzi scheme, promising fellow Mormons and members of a classic car club high returns. But they said most of the estimated $20 million he took in funded his lavish lifestyle.