A New Jersey man living in Idaho has been sentenced to prison for stealing funds from people who invested in his phony corporation that claimed to have developed a revolutionary technology to convert water to hydrogen fuel.

New Jersey Superior Court Judge Thomas P. Kelly of Mercer County sentenced Patrick Kelly, 51, now of Kuna, Idaho to five years in state prison on a charge of second-degree theft. The defendant also was ordered to pay $400,000 in restitution. Kelly pleaded guilty to the charge this summer, admitting that he used more than $200,000 in funds invested in his fake company United Fuel Cell Technologies to purchase eight cars in his own name, including a $60,000 Hummer and a car he gave to his neighbor's son as a gift.

An investigation by the Division of Criminal Justice determined that between November 2000 and June 2004, Kelly collected about $2.5 million in investments in United Fuel Cell Technologies from about 500 people, mostly New Jersey residents.

Prosecutors alleged that Kelly spent investor funds on a variety of expenses, many of which were clearly not related to the business or the development of their purported technology. Kelly allegedly spent $80,000 for a fountain for his home and financed a credit card for his 12-year-old daughter.

"This defendant is going to prison because he stole from investors," said New Jersey Attorney General Stuart Rabner. "We are committed to vigorously prosecuting these cases to protect New Jersey residents who are trying to invest and save for their retirement or their children’s education."

"Mr. Kelly claimed to offer investments in a breakthrough technology. In reality, he offered only lies," said Gregory Director Paw, director of the New Jersey division of criminal justice. "We have ensured that he will be appropriately punished for his greed and deception."

Kelly was a "slick salesman," according to Peter Aseltine, public information officer for the New Jersey Office of the Attorney General. "He had a device manufactured for him, but it was really nothing more than a hydrogen fuel cell demonstrator that you could purchase in a local hobby shop. And then he would hold demonstrations of this revolutionary technology in remote or rural sites and create an aura of secrecy that he had this revolutionary technology when, in fact, he had nothing new."

The Division of Criminal Justice obtained a state grand jury indictment on Sept. 23, 2005 charging Kelly with second-degree securities fraud in connection with his sale of “common stock” in United Fuel Cell Technologies. The indictment alleges that he falsely claimed that United Fuel Cell Technologies was a Delaware corporation, and that Hewlett Packard and IBM had agreed to assist the corporation in developing and marketing its technology and related products. In fact, United Fuel Cell Technologies was never incorporated, and Hewlett Packard and IBM did not make any agreement with the company. Kelly also was indicted on second-degree charges of conspiracy and theft.

The judge today dismissed charges in the case against a second man, John Yoka, 35, of Livermore, California.

Kelly, who also used the name Genesis World Energy, fraudulently claimed to have invented a process to separate the hydrogen and oxygen molecules in water to produce hydrogen and oxygen gases to be burned as fuel or used in fuel cells.