A former Denver man was sentenced to 42 months in federal prison after prosecutors said he helped conceal the collapse of a Colorado forex investment fund that turned out to be a Ponzi scheme, taking in roughly $8 million from more than 50 investors before it fell apart. Heath Posey, 39, served as chief financial officer of the ROI Cash Flow Fund, and a federal judge also ordered him to pay $6.2 million in restitution to victims and the IRS, along with a $10,000 fine.
The sentence, handed down by U.S. District Judge Charlotte N. Sweeney, closes out one of the final chapters in a sprawling fraud case that stretched from a phony currency-trading fund to a nationwide tax-shelter scheme, according to the Denver Gazette. Posey's case followed an FBI and IRS investigation, and prosecutors say he knew the fund had gone bad well before he stopped promoting it to new investors.
How the Fund Unraveled From the Inside
The ROI Cash Flow Fund launched in June 2022, marketed around foreign currency exchange trading and promising investors a 3% monthly return, per the Denver Gazette. Fund founder Timothy McPhee hired Posey as CFO, and Posey helped promote the fund to new investors while tracking the money and payouts moving through the operation, the outlet reported.
According to the U.S. Department of Justice, the underlying forex trader stopped making expected payments in February 2023, and Posey knew by March 2023 that the fund was not operating as advertised. Even so, the Justice Department says he continued helping conceal and run the scheme through May 2024 — more than a year after he recognized it was failing. During that stretch, McPhee and Posey kept recruiting new targets and used their contributions to pay off earlier investors, the Denver Gazette reported.
Millions Raised, Millions Diverted
From January 2023 until the fund's collapse in February 2024, it raised approximately $8 million from more than 50 investors, according to federal prosecutors cited by the Department of Justice. Roughly $5 million of that was paid back to earlier investors, using new money to keep up the appearance of steady returns — the textbook structure of a Ponzi scheme.
Investors had been explicitly promised their capital would not go toward administrative salaries, operational fees, or fund expenses. Federal court records show Posey and McPhee violated those very agreements, using investor funds to cover Posey's salary and diverting $2.2 million directly to McPhee for personal gain, an amount that included Posey's salary and expenses, per the Denver Gazette.
Assistant U.S. Attorney Amanda Koldjeski said Posey “lied repeatedly to investors” and caused people to lose their life savings and retirement funds, and added that he “played a substantial role in orchestrating an elaborate Ponzi scheme that cost investors millions of dollars.” U.S. Attorney Todd Wacaser said Posey “will spend years in prison for participating in a conspiracy that defrauded investors,” adding that “criminals who prey on hardworking people should expect accountability.”
The Mastermind's Bigger Fall — and a Wider Web
McPhee's fraud went well beyond the forex fund. From 2018 through 2023, he ran a nationwide abusive tax shelter that used four layered trusts and a private family foundation to help high-net-worth clients dodge taxes on as much as 98% of their income, causing an estimated $45 million in unpaid federal taxes, according to 9News. The scheme promoted family foundations as a device to avoid bracketed taxable income, and the IRS says McPhee personally used the structure from 2016 through 2021 to hide more than $5 million of his own income, evading about $1.8 million in federal taxes.
McPhee promoted the phony tax-shelter operation in seminars and over the internet, according to the Denver Gazette, even as tax attorneys and others warned targets that the family-foundation devices were illegal and risked criminal prosecution. He pleaded guilty in August 2025 to wire fraud, tax evasion, and conspiracy to defraud the United States, and was sentenced in Estes Park to more than 12 years behind bars — 151 months, according to IRS Criminal Investigation records. He was also ordered to pay more than $59 million in restitution, per the Denver Gazette.
The tax shelter, marketed under the slogan that clients could “own nothing, control everything,” charged high-net-worth business owners between $25,000 and $50,000 to set up, according to trial proceedings reported by the Washington Times. On June 8, a federal jury in Colorado convicted four other people tied to the arrangement — McPhee's wife, Marcia Predmore, along with Roderick Prescott, Suzanne Thompson, and Weldon Wulstein — of conspiracy to defraud the United States in what the Justice Department described as a $40 million tax shelter scheme. The Washington Times noted that Prescott was no stranger to federal scrutiny, having been permanently barred from promoting abusive tax schemes in 2003 and previously sentenced to 30 months in prison for tax evasion in 2009.
McPhee and Posey were first indicted by a federal grand jury in Denver in December 2024 on charges of wire fraud, conspiracy to commit wire fraud, and money laundering, with each wire fraud count carrying a maximum statutory penalty of up to 20 years in prison, according to the Estes Valley Voice. With Posey's sentence now handed down, the case marks one of the final legal resolutions in a fraud network that federal officials say ultimately cost private investors their savings and cost the U.S. Treasury tens of millions of dollars in unpaid taxes.
