U.S. Attorney Charges Hoover Man for Role in
Ponzi Scheme That Bilked Millions from
|U.S. Attorney’s Office December 29, 2014|
BIRMINGHAM—Federal prosecutors today charged a Hoover man with fraud and money laundering in connection with an illegal Ponzi scheme that caused investors to lose more than $3 million, announced U.S. Attorney Joyce White Vance, FBI Special Agent in Charge Richard D. Schwein Jr., Alabama Securities Commission Director Joseph P. Borg and Hoover Police Chief Nick Derzis.
The U.S. Attorney’s Office charged
BRYAN W. ANDERSON,
40, with one count each of wire fraud, money laundering and securities fraud. The office filed the charges in U.S. District Court, along with a plea agreement in which Anderson acknowledges the charges and agrees to plead guilty to them.
As part of his plea agreement, Anderson also agrees to pay restitution of about $3.1 million to victim investors. He also agrees to forfeit that same amount to the government, as proceeds of illegal activity, along with another $368,000, which is the amount cited in the money laundering charge.
“For years this defendant lied about investment options, risks and potential returns so that unwitting investors would continue to put their hard-earned money into his fraudulent scheme,” Vance said. “When his Ponzi scheme collapsed, as they always do, the people who trusted him lost millions. I applaud the hard work of the FBI, Alabama Securities Commission and Hoover Police Department, along with Assistant U.S. Attorney J. Patton Meadows, which led to the prosecution of this case.”
“This case is a classic Ponzi scheme, as Anderson used false promises and fake returns to steal millions of dollars from his victims,” Schwein said. “Consumers looking to invest are encouraged to review www.investor.gov, which helps investors recognize scams and avoid fraud. The public can be assured that the FBI will continue to use our resources and work closely with our partners to expose perpetrators and vindicate the victims of complex financial frauds.”
“The Alabama Securities Commission is gratified to see justice imposed for the crimes that Bryan Anderson committed against innocent citizens of Alabama and other states; of course, no punishment can take away the loss and hurt to the investors who were victimized,” Borg said. “We are grateful and want to thank the Hoover Police Department, the FBI and the U.S. Attorney’s Office for the Northern District of Alabama, in addition to the ASC staff, for successfully partnering together to ensure justice was served in this case. The strong law enforcement response to this crime should serve as notice to other scammers out there that they should stay out of Alabama or expect prosecution and imprisonment.”
“I am very pleased with our department’s response in this case,” Derzis said. “After taking the initial report, Hoover investigators realized the extent of the fraud and contacted the Alabama Securities and Exchange Commission, along with the FBI. With these agencies working together, we were able to obtain Mr. Anderson’s agreement to plead guilty to his crimes and to repay the victims.”
According to the government’s charging information and its plea agreement with Anderson, he conducted his investment scheme as follows between 2009 and May 30, 2014:
During most of that time, Anderson was a registered financial broker working, first, with MetLife Securities, from October 1998 to February 2012, then with Pruco Securities, from February 2012 to Sept. 13, 2012, when Pruco terminated his employment.
As part of his scheme to defraud investors, he solicited them to invest in stock options that he said employed various trading strategies. The stock options he described were not registered securities, and Anderson was not authorized to solicit investor money for the funds.
Anderson also offered investments in a company he
owned, 360 Properties.
Beginning about 2009, Anderson falsely represented to
certain 360 Properties investors that their returns
would come from leased property income, when
there were no leased properties.
Some of the investors believed the 360 Properties
investments were affiliated with MetLife, and
Anderson did nothing to correct that false belief.
Between January 2009 and January 2014, Anderson’s false investment promises caused about 18 individual and family investors to deliver more than $8.4 million to Anderson, which he deposited into an account he and his wife held at BancorpSouth, a bank based in Tupelo, Miss.
When Anderson’s investment scheme collapsed in May
2014, about 12 investors lost about $3.1 million.
Anderson was operating a Ponzi scheme with investor funds, paying returns to existing investors with money from new investors, as well as paying personal expenses. He transferred investor money from one of his and his wife’s bank accounts to another, making only a small percentage of the investments he had promised investors.
The wire fraud count charges that Anderson caused an investor, identified in court documents by the initials K.C., to wire transfer $571,378 from the investor’s Wells Fargo bank account to Anderson’s BancorpSouth account in the name of 360 Properties on Jan. 15, 2014.
The money laundering count charges that Anderson took $368,000 of the $571,378 received from K.C. and on Jan. 15 transferred it by wire to a second BancorpSouth account. According to the charge, the $571,378 was “criminally derived property” obtained through wire fraud. It is a violation of federal law to engage in a monetary transaction involving money or property worth more than $10,000 that was obtained through a criminal act.
The securities fraud count charges that Anderson, on Aug. 20, 2013, fraudulently obtained $100,000 from an investor, identified by the initials T.M., by falsely representing that he would invest the money in a specific type of hedge fund. T.M. wired the money from an account at Bryant Bank to one of Anderson’s BankcorpSouth accounts and Anderson took the money and used it for non-investment purposes.
The maximum penalty for wire fraud is 20 years in prison and a $250,000 fine. The maximum penalty for the money laundering charge is 10 years in prison and a $250,000 fine, and the maximum penalty for the securities fraud charge is five years in prison and a $10,000 fine.
The FBI, ASC and the Hoover Police Department investigated the case, which Meadows is prosecuting.