PatrickPretty.com

Tag: Kenneth J. Hines

  • Raymond Leo Jarlik Bell, 70-Year-Old Purported ‘Sovereign Citizen’ Linked To AdSurfDaily Figure Kenneth Wayne Leaming, Sentenced To More Than 8 Years In Federal Prison

    ponziblotterRaymond Leo Jarlik Bell, a 70-year-old purported “sovereign citizen” linked to AdSurfDaily figure Kenneth Wayne Leaming, has been sentenced to 97 months in federal prison for a tax scam.

    In July 2011, federal agents found records of bogus liens filed by Leaming against public officials while executing a search warrant at Jarlik Bell’s residence in Yelm, Wash., according to court records. Bell was under investigation for his tax scam at the time the records were found. Leaming, 57, later was charged with filing bogus liens, harboring federal fugitives from Arkansas in Washington state and being a felon in possession of firearms, including a “street sweeper” shotgun and an assault rife.

    Leaming was sentenced in May to eight years in federal prison. David Carroll Stephenson, another Leaming associate and purported “sovereign citizen” from Washington state, was sentenced in May to 10 years for filing bogus liens against two U.S. prison officials. Stephenson, 57, already was serving time for a tax scam when those liens were filed.

    Jarlik Bell’s scam centered on filing for false tax refunds “using a scheme known as OID fraud,” prosecutors said.

    OID fraud may include claims that the U.S. government maintains secret accounts for citizens and that such accounts can be tapped to receive tax “refunds” in the tens or even hundreds of thousands of dollars at a time if paperwork is filed in a certain manner.

    “No matter what the promoter calls it, a scheme to file bogus tax returns claiming outrageous tax ‘refunds’ that don’t belong to you, is just fraud,” said Kenneth J. Hines, special agent in charge of IRS Criminal Investigation in Seattle.

    “This defendant held himself out as a tax expert with contacts at the IRS – when both the IRS and a federal judge told him repeatedly that his conduct was criminal,” said U.S. Attorney Jenny A. Durkan of the Western District of Washington. “Mr. Jarlik Bell believed he was above the law, and aggressively promoted and spread his scheme to others looking to duck their fair share and steal tax dollars through fraudulent refunds.”

    From a statement by prosecutors (italics added):

    In 2006, BELL obtained a tax refund in excess of $30,000 using the scheme. Numerous others who were advised by JARLIK BELL also filed for and received fraudulent refunds they did not deserve.  One woman received a tax refund of more than $590,000.  In 2005, JARLIK BELL was ordered by U.S. District Judge Robert J. Bryan to stop promoting fraudulent tax schemes.  Less than three years later, he was back promoting another massive tax fraud among friends, family and strangers.

    Ute Christine Jarlik Bell, Jarlik Bell’s wife, also is a purported “sovereign citizen” and tax scammer, prosecutors said. She is scheduled to be sentenced tomorrow on four counts of filing false, fictitious and fraudulent claims.

    Jarlik Bell was convicted in March 2013 of five counts of filing false, fictitious and fraudulent claims, 15 counts of assisting in filing false tax returns, three counts of mail fraud, and one count of criminal contempt, prosecutors said.

    U.S. District Judge Ronald B. Leighton described Jarlik Bell’s scheme as “fraud at its core,” prosecutors said.

    “You are hurting people intentionally, regardless of your adherence to [your beliefs],” prosecutors quoted Leighton as saying.

    Leaming filed bogus liens against a federal judge, federal prosecutors and a U.S. Secret Service agent involved in the prosecution of the the ASD Ponzi scheme. The Secret Service has described ASD as a “criminal enterprise” that gathered about $119 million by duping people into believing that ASD’s purported payout of 1 percent a day came from legitimate means. ASD operator Andy Bowdoin, 78, is serving a 78-month prison term.

    When Leaming was arrested in November 2011, investigators discovered he’d been harboring two federal fugitives from Arkansas charged with mail fraud in a separate home-business scheme that allegedly had gathered millions of dollars.

    Leaming, who previously had sued President Obama and Attorney General Eric Holder on a theory that Obama was not born in the United States and was an unlawful President who’d appointed Holder unlawfully, went on to claim that Leighton owed him 208,000 ounces of silver.

    The lawsuit against Obama and Holder was tossed out of court by a federal judge.

     

     

  • Investigators Outline Darren Berg’s Ponzi Haul: ‘Stunning’ Greed, Top Prosecutor Says; ‘No Moral Compass,’ Judge Comments When Ordering Washington State Schemer To Spend 18 Years In Jail

    “The greed in this case is stunning. [Frederick Darren Berg] stole and squandered the dreams of hundreds: dreams of retirement, dreams of homeownership, dreams of a college education for their children and grandchildren. While we could not restore those dreams, today he was held accountable for his acts.” — U.S. Attorney Jenny A. Durkan, Western District of Washington, Feb. 9, 2012

    Frederick Darren Berg gestures during his sales pitch for his Ponzi scheme in 2009. Source: YouTube.

    It was the largest fraud scheme ever prosecuted in the Western District of Washington. Before his Meridian Group of funds collapsed into a pile of Ponzi rubble, Frederick Darren Berg ensconced himself in the lap of luxury.

    Among other things, prosecutors said, Berg had acquired:

    A $1.95 million condominium at Second and Union in Seattle.

    A $1.25 million house in La Quinta, Calif.

    A $1.4 million condominium in San Francisco.

    A $5.475 million waterfront home on Mercer Island in Washington state.

    Two Lear jets for $5.5 million, including operational costs.

    “Several” yachts that consumed $3.6 million through “purchase, operation and frequent modification.”

    Even after he was caught, the lies and profligate spending continued, prosecutors said.

    Berg concealed about $400,000 from bankruptcy trustees while claiming to be cooperating. He sold a home he did not disclose in his bankruptcy filing, pocketing the proceeds and depositing the undisclosed windfall “into a series of bank accounts he concealed from the trustee.”

    While his investors were left holding the bag, Berg used the cash to make lease payments on a Porsche Cayenne and Porsche 911 Turbo Cabriolet. In addition, prosecutors said, he paid a year’s rent up front on a Los Angeles apartment, bought an Audi S5 convertible, purchased insurance for “jet skis” and a yacht — and plunked down a retainer for a criminal defense attorney.

    Berg was charged criminally in November 2010 with wire fraud, money laundering and bankruptcy fraud. He pleaded guilty in August 2011.

    “Those who peddle false investments and prey on investors for their own personal financial benefit need to understand that law enforcement will not sit by and let it happen,” said Kenneth J. Hines, IRS special agent in charge of the Pacific Northwest.

    It was a case of “unadulterated greed,” a top FBI agent in Seattle said.

    “Mr. Berg took advantage of hopeful investors — many of them senior citizens who depended on their carefully built savings to afford assisted living, medical care, and higher educational opportunities for future generations,” said Steven M. Dean, assistant special agent in charge of the Seattle office.

    The day of reckoning for Berg, 49, came yesterday.

    Prior to sentencing Berg to 18 years in federal prison, U.S. District Judge Richard A. Jones told Berg “he had ‘reckless disregard for his victims . . . and had no moral compass,” prosecutors said, quoting the judge.

    Restitution is still being compiled. Prosecutors said it is expected to top $100 million, noting that Berg’s real-estate and financial swindle took in $245 million between 2001 and 2009 and consisted of schemes within schemes.

    Without investors’ knowledge, about $45 million was peeled off to acquire buses and to operate a transportation company known as MTR Western and subsidiaries.

    The long-running Berg swindle defrauded more than 800 investors, prosecutors said.

    Here is an outtake from the government’s sentencing memo. (Italics added):

    “Indeed, many of Mr. Berg’s victims will be forced to make significant changes to their lifestyle and that of their families such as foregoing retirement, taking additional jobs to support their children’s’ education and selling their homes. Others are likely to be forced into bankruptcy and may also lose their homes because of the financial devastation Mr.Berg’s fraud has caused.”

    Read a Seattle Times story on Berg’s sentencing and courtroom comments. Visit the YouTube site of the Times to see a Berg Ponzi sales pitch. (He references Bernard Madoff while addressing the audience.)