Fla. Probes $60M Laudering Scheme
May. 08, 1998
TALLAHASSEE, Fla. (AP) _ A vast venture capital scam cheated more than 400 people out of at least $60 million in the biggest nondrug money-laundering case ever investigated by the U.S. Customs Service, authorities said.
A network of self-styled brokers and syndicators collected up-front processing fees ranging from $40,000 to $2 million from entertainers, athletes, surgeons, attorneys and others seeking money to start or expand businesses, prosecutors charged Thursday.
No venture capital loans ever were distributed.
``They all got sucked in,'' Customs spokesman Michael Sheehan said. ``Everyday people, famous people, you name it.''
Eight people were arrested Wednesday and Thursday in the scheme to launder money through banks on the Caribbean island of Antigua before moving it back to the United States. Four people arrested as part of the same investigation last August have pleaded guilty, agreed to cooperate and await sentencing.
The network advertised in national and international publications, and people responded from the United States, Canada, Britain, France, Greece, Israel, Turkey, Australia, Singapore and the British Virgin Islands.
Applicants were interviewed by ``brokers'' to determine their needs and their ability to pay, and ``syndicators'' gave them elaborate contracts to sign. Applicants later were informed that they had failed to meet terms of the contracts and their processing fees were forfeited.
Some victims even met with ``facilitators'' to help them comply with the contract, often for additional fees. Some victims made up to a half-dozen payments over a period of months, authorities said.
Losses by scam victims uncovered so far totaled at least $60 million, but the daily bank activity indicated losses will turn out to be far higher, investigators said.
Sums ranging from $95,000 to $650,000 were transferred to legitimate accounts in the American International Bank and the Caribbean American Bank in Antigua, according to an indictment.
One of the scam's accused leaders, Lawrence G. Sangaree Jr., 49, dropped out of the 10th grade and served 17 years in prison for killing a high school teacher before getting into the fake venture-capital business.
Ronald Allen Cohen, 54, a Boston, Ga., lawyer; Arthur W. Householder, 50, of Norman, Okla.; David W.V. Rogers, 56, of Rutherford, N.J.; Jessica Jasmin Maun, 26, of West Palm Beach, and Barry Lichtman, 60, of Plantation were arrested Wednesday and Thursday, U.S. Attorney Michael Patterson said.
Also charged were Jerrell A. Breslin, 45, of Miami, already in federal custody on other charges; Robert Ian Newman, 40, of Clearwater; and Robert Petrie, 56, of Key Largo, who were still at large, Patterson said.
Sangaree; his wife, Terri L. Sangaree, 31; and Peter A. Barnum, 42, and his wife, Maxine M. Barnum, 27, of Gainesville, were arrested in August, pleaded guilty to money laundering conspiracy counts and await sentencing, prosecutors said.
Those who pleaded guilty or are convicted could face up to 20 years in prison and fines up to $500,000, or twice the amount the government is able to prove they stole.