NEW MEXICO (KRQE) – The man once known as the Bernie Madoff of New Mexico may soon be out of the loop of the justice system. Doug Vaughan has been out of prison for the past few years and may soon get an early release from his probation.
Vaughan started with a legitimate investment involving his New Mexico real estate business in the 1990s but by 2005 it had turned into a Ponzi scheme. Vaughn used his victims’ money to keep his real estate company afloat. It was also used in a mansion in Tanwan, luxury furniture, a Ferrari, high-priced jewelry and travel around the world. The scheme bilked 600 investors out of $74 million over five years.
“The Doug Vaughn case is widely regarded in the law enforcement community as the single largest financial crime in New Mexico’s history,” said Alan Wilson of the New Mexico Securities Division.
Vaughn was convicted in 2011 and sentenced to 12 years in an Arizona federal prison. A decade later, he was released. Meanwhile, his victims saw some recovery after investigators were able to recover $38 million and sell some of his property. A judge ordered Vaughn to pay another $43 million but full recovery is still far from over.
“The tragedy here is that regardless of the sentence, the victims will never be able to recover any of what they lost,” said former U.S. Attorney Ken Gonzales.
According to a probation report, Vaughn is following court rules and paying monthly restitution. Recommend them? Let Vaughn get off probation three and a half years ago now. Federal prosecutors do not object to that recommendation. A federal judge has yet to rule on whether to release Vaughn from probation.
