Chattanooga Lookouts investor faces fraud charges for running 'massive Ponzi scheme'

Staff photo by Tim Barber / John J. Woods

Federal regulators have charged one of the owners of the Chattanooga Lookouts baseball team with "running a massive Ponzi scheme for over a decade" that has defrauded more than 400 investors already and continues to illegally raise more money to try to pay off previous investors.

In a 40-page complaint filed in federal court, the U.S. Securities and Exchange Commission charged John J. Woods and his Chattanooga-based Southport Capital investment firm with six counts of securities fraud. The complaint said Woods' Ponzi scheme, which goes by the name Horizon Private Equity, collected more than $110 million from investors with promises of 6-7% rates of return but the investments "are worth far too little for there to be any realistic prospect that the Ponzi scheme will be able to pay back existing investors their principal, let alone the promised returns."