A Boston-area hedge fund manager was recently arrested and charged in federal court in Boston with running a multimillion-dollar Ponzi scheme.

Raymond K. Montoya, 69, of Allston, was charged with mail fraud and wire fraud. Montoya was released on conditions following an initial appearance in federal court.

Montoya ran a pooled investment hedge fund in Boston called RMA Strategic Opportunity Fund LLC. It is alleged that Montoya falsely told his investors – including his family, friends and acquaintances who resided in Massachusetts, Ohio and California – that the fund was earning substantial returns when it was actually sustaining substantial losses. According to court documents, the victims transferred millions of dollars of their personal savings and 401(k) retirement plans to Montoya and the RMA Fund. Montoya told his investors that he would invest their money in stocks and bonds, but he invested only a portion of their money, while diverting the rest – totaling millions of dollars – to business and personal bank accounts. Montoya allegedly used the diverted money for personal expenses such as luxury vehicles and the mortgage on his son’s residence.

Montoya was previously charged with securities fraud in a civil complaint by the Massachusetts Securities Division.

He faces up to 20 years in prison if convicted.