One of three defendants in an alleged $360 million Ponzi scheme involving hundreds of investors in Maryland and Virginia pleaded guilty on Tuesday in an agreement with federal prosecutors, the Washington Post reported. In a federal courthouse in Baltimore, Assistant U.S. Attorney Joyce MacDonald described Cameron Jezierski of Texas as an accomplice to two others — Kevin Merrill of Towson, Md., and Jay Ledford of Texas — in promoting “investor confidence that they could entrust their funds to what was really a criminal enterprise.” Jezierski faces a $116,435 fine and a maximum sentence of 20 years in prison, though his term could be much less because of the plea agreement. The prosecutors say the alleged scheme was led by Merrill and Ledford. Both face civil and criminal charges. The three men are accused in court papers of duping more than 400 investors with “an elaborate web of lies” to give the impression that they were running a successful investment operation profiting from student and consumer debt. In reality, prosecutors say, the men were fraudulently diverting investors’ money to maintain a criminal operation in which funds were cycled from one investor to the next. The trio offered investors the chance to profit from consumer debt portfolios — basically car, student loan and credit card debts that people have defaulted on, with assets that could be eligible for seizure. Prosecutors alleged the defendants actually were diverting the payments they received for those investments into their own pockets and to pay off earlier investors. Prosecutors say investors were cheated out of more than $360 million. Read more.
For a further analysis of commercial fraud, make sure to pick up a copy of ABI’s Fraud and Forensics: Piercing Through the Deception in a Commercial Fraud Case.
