The government says an ex-con, who had been convicted of charges related to a Ponzi scheme in California, and his wife collected $3 million in another Ponzi scheme, most of it from Hawaii inmates serving time on the mainland and their families.

A federal grand jury returned an indictment Thursday charging Perry Jay Griggs and Rachelle Griggs with wire fraud and mail fraud.

The U.S. Commodity Futures Trading Commission filed a separate civil lawsuit against the Griggses and Kapua Keolanui, the wife of a Hawaii inmate serving time in a federal prison on the mainland.

Perry Griggs was serving the remainder of an eight-year federal prison sentence at Nellis Air Force Base in Las Vegas from August 2003 to September 2008 for the California Ponzi scheme when he and his wife persuaded other inmates to invest in their Aloha Trading Co. for guaranteed returns.

Griggs claimed he was a wealthy, expert commodity futures trader serving time for tax offenses when in fact he was serving time for wire fraud and money laundering and was never registered as a commodity trader. As part of his prison sentence, Griggs was also ordered to pay more than $3 million in restitution to 47 individual victims.

According to the indictment and CFTC filing, the Griggses persuaded the Hawaii inmates and their families to refinance their mortgages and empty their retirement savings accounts to invest in Aloha Trading. The Griggses helped Keolanui to start her own investment company, Paradise Trading, to solicit investors in Hawaii and send the money to Aloha Trading. Keolanui sent $663,000 she collected in Hawaii to the Griggses, according to court records.

The government says of the $3 million the Griggses collected, they used $1.1 million to pay "returns" to Aloha Trading "investors" and sent $467,000 back to Keolanui for her to pay "returns" to Paradise Trading "investors." They also invested $775,000, losing all but $130,000, and spent the rest for personal use. The Griggses spent about $1 million on luxury car leases, rent for a house in Hawaii, chartering a private jet and buying jewelry, according to court records.