A New York entrepreneur was sentenced to a 41-month term in a federal prison for defrauding investors out of more than $3 million with his CrossFit-branded gyms.
Yale University graduate Joshua B. Newman, 37, pleaded guilty in March 2016 to committing wire fraud as part of a two-year-long scheme in which he defrauded 30 people who believed they were investing in his health clubs. On June 27, Judge William H. Walls of the Federal District Court in Newark sentenced Newman to a 41-month prison stint, as well as three years of court supervision, according to a report by The New York Times.
“Although today’s sentence disappoints us, we have complete faith that Josh shall return to society as a true asset to his community,” Newman's lawyer Priya Chaudhry told the Times. “Josh is lucky to have many gifts, including resilience.”
Newman apologized to his victims, accepts full responsibility for his crimes and intends to repay his victims, Chaudhry said.
From 2012 through mid-2015, Newman solicited investments from college and professional acquaintances for two of his CrossFit-branded businesses. (Newman operated independently and was never directly associated with CrossFit Inc.) However, he was accused of using these funds for personal expenses, such as bankrolling other entrepreneurial endeavors.
“Josh acknowledged he came from privilege and he blew it,” Michael Stolper, a lawyer who represented 11 of the investors, told the Times. “I think justice was served.”
Newman is slated to enter prison Aug. 28.