LOS ANGELES (CNS) — Two Woodland Hills men were each sentenced to multiple years behind bars for running what prosecutors characterized as one of the largest Ponzi schemes ever seen in the Southland.

Joel Barry Gillis, 75, was sentenced to 10 years in federal prison and 77-year-old Edward Wishner will serve nine years for masterminding the 13-year-long scheme.

Hundreds of millions of dollars was lost by more than 1,300 investors who were falsely told their money would purchase profitable automated teller machines that would generate annual profits of at least 20 percent, prosecutors said.

On Monday, Nov. 16, U.S. District Judge S. James Otero cited the “staggering losses suffered by the victims,” many of whom spoke to the court of the emotional and financial effects of the theft.

“Because of their excessive greed, they elected to hurt many people,” one victim told Otero.

Another broke down when describing how he and his family has lost their life savings and were forced to sell their home of 20 years.

“We were stripped of our sense of community and dignity,” he told the court.

Gillis’ attorney, Jim Spertus, said prior to the hearing that the government’s contention that the defendants are unfeeling con men who took advantage of gullible members of the community is false.

“They are two very good-hearted old men who do not deserve (what would amount to) life sentences for a variety of reasons,” Spertus said.

“Almost all investor money went to investors, less relatively modest salaries, and until the business collapsed, the investors received guaranteed 20 percent returns for many years,” the defense attorney maintained.

“Some investors made many millions of dollars from their investments, and many others lost money, but Joel and Ed are not evil and did not perpetrate a scheme to enrich themselves,” he said.

Taking into account the “major magnitude” of the scheme, Otero said he issued sentences less than those called for under federal sentencing guidelines after considering the defendants’ ages, their early guilty pleas in the case and their attempts to help a court-appointed receiver identify remaining assets that could be used to repay victims.

A restitution hearing was scheduled for Feb. 1, and the judge ordered the defendants to begin serving their sentences on Dec. 28.

Gillis and Wishner each pleaded guilty in January to conspiracy, two counts of mail fraud and one count of wire fraud.

According to documents filed in Los Angeles federal court, Gillis and Wishner were the owner-operators of Calabasas-based Nationwide Automated Systems Inc., which purported to place, operate and maintain ATMs in high-traffic locations, such as hotels, casinos and convenience stores.

NASI claimed that it operated more than 30,000 ATMs and was involved in more than $1 billion in ATM transactions monthly.

Investors paid a flat amount — typically $12,000, but in some cases as much as $19,800 — to buy a specific ATM that was to be installed at a specific location.

Gillis and Wishner told investors that NASI would lease back the ATMs and pay investors 50 cents for each transaction performed at their particular ATM, guaranteeing annual returns of at least 20 percent on each ATM.

NASI never made monthly payments to investors — that money came from other investors, as is typical in Ponzi schemes, prosecutors said.

While NASI did operate a small number of ATMs — no more than 250, which were owned by the company and not investors — the overall operation was a sham, authorities said.

“These sentences should serve as a deterrent to other would-be white-collar criminals, yet it cannot rectify the damage done to the lives of over 1,300 victims,” said David Bowdich, assistant director in charge of the FBI’s Los Angeles field office.

“I strongly urge investors to question and do their due diligence when the stated returns are seemingly too good to be true,” he said.

Gillis and Wishner prevented investors from discovering the fraudulent nature of the business by providing bogus monthly reports to the investors that falsely detailed the supposed performance of the investors’ ATMs.

The con artists also included a “non-interference” provision in the lease agreements that prohibited victim-investors from visiting the locations where their ATMs were supposedly located, federal prosecutors said.

But, even as the Ponzi was collapsing, Gillis and Wishner continued to raise another $15 million from investors.

“When Gillis and Wishner’s Ponzi scheme collapsed, the victim-investors suffered irreparable financial harm, leaving them struggling to make ends meet, facing retirement bereft of assets, and unable to pay for necessary health care or provide for family members’ medical expenses, education, and other needs,” Assistant U.S. Attorney Ranee Katzenstein wrote in a pre-sentencing memorandum filed with the court.

“These victims included individuals from whom Gillis and Wishner had solicited ‘investments’ even after the U.S. Securities and Exchange Commission had served NASI with a subpoena signaling NASI’s imminent shut-down,” she wrote.

The SEC filed a civil lawsuit in relation to the NASI scheme in September 2014, which resulted in a court order freezing the company’s assets and the appointment of a receiver.