A Maryland man and two Texas residents have been indicted for an elaborate plan to launder more than $364 million in investments as part of a Ponzi scheme that entangled more than 400 people, federal prosecutors say.
Kevin Merrill, 53, of Towson, Maryland, along with 54-year-old Jay Ledford and 28-year-old Cameron Jezierski, face charges of conspiracy, wire fraud, identity theft and money laundering, and were arrested Tuesday, according to U.S. Attorney Robert Hur.
The trio allegedly lured investors into a web of lies, inviting people to buy consumer debt portfolios, bundles of debt that are bought and sold like other goods, but they did not disclose their plans to profit off of the debt.
The indictment alleges they also misrepresented from whom they would buy debt portfolios and how much they would initially pay for the portfolios. To keep the ruse alive, the trio allegedly also created shell companies, false portfolio overviews and sales agreements and falsified signatures, bank wire transfer records and statements.
Authorities said the three suspects diverted $73 million of investors' money to buy expensive homes in Maryland, Texas, Nevada and Florida, 26 luxury cars, a boat and a 23-carat diamond bracelet, among other splurges.
Some $25 million was spent on casino gambling, prosecutors allege.
"Most of these investors are just learning that they have been victimized. The effects of this kind of fraud can be devastating," Hur said.
If convicted, the trio each could face a maximum of 20 years in prison for the wire fraud conspiracy and 20 more years for an additional two counts of write fraud, including a handful of other fines.
The FBI has set up an email address for investors who think they may have fallen victim to the scheme. They're asking anyone who thinks they may be a victim to email MerrillLedford@FBI.gov.
