LEXINGTON, Ky. (WKYT) - Next time you think you've found an investment that is foolproof, think again. You can never do enough research before investing money you think you can't lose.
Real estate developer Wayne King decided to take out a loan for $400,000 to invest in a startup powder coating business.
"Mr. King thought it sounded like a great opportunity," says U.S. Postal Inspector Tammy Mayle.
Power coating is the process of coating metal with paint in a powder form that is considered more environmentally friendly.
The conmen told King the bank was also lending them a million dollars to get the business off the ground.
"So, Mr. King thought if the bank and the SBA is backing the loan I should be able to give $400,000 dollars and be fine," Mayle says.
It turns out, the conmen lied on their bank application.
"I did due diligence on myself, but the bank authorizing this didn't do due diligence on this guy," says King.
While King was being strung along by excuses and delays, postal inspectors found out the business was never operational.
"You should know the people you are dealing with," King says. "Find out what their personal finances are."
Inspectors say King's life has been turned upside down.
"He was devastated. This was his livelihood, his retirement. He is 73 years old and he still works eight to ten hours a day to repay this loan," says Mayle.
The suspects were convicted on bank fraud and ordered to pay restitution.