ALEXANDRIA, Va. (AP) — Federal prosecutors say a Virginia businessman has been sentenced to prison for a $1.3 million investment scheme that caused losses for 40 victims.

The U.S. Attorney for the Eastern District of Virginia announced Friday that Amrit Jaswant Singh Chahal was sentenced to 2 ½ years in prison. Court documents show he agreed last year to plead guilty to wire fraud and securities and commodities fraud.

Authorities say Chahal falsely told clients his company earned returns of more than 28 percent annually. They say he falsified brokerage statements to conceal losses.

They say he operated a Ponzi scheme by using money from newer investors to pay older investors and make it appear they had a return on investment.

A lawyer for Chahal didn't immediately respond to an email Saturday seeking comment.