Former Southern California securities professionals Dennis J. Clinton and Paul R. Martin were sentenced to 30 months and William J. Ferry was sentenced to serve 15 months in prison for their roles in the commission of conspiracy, mail and wire fraud through the operation of a fake high-yield investment scheme they falsely claimed was a "Fed Trade Program" that was regulated by the Federal Reserve Bank.
They also falsely claimed the program's purpose was to solicit funds for charitable endeavors related to humanitarian interests such as Hurricane Katrina relief and that investors' offshore bank accounts would be managed by a Swiss banker who was already managing "billions of dollars" for Ferry, Clinton and Martin.
The FBI described the conspirators' roles thusly: Ferry acted as an underwriter and member of the compliance team, Clinton acted as a compliance trouble shooter and person responsible for transfer of funds to the Swiss banker and Martin acted as a banking expert.
After a federal jury found the broker and investment managers guilty in 2012 after the trio attempted to dupe an FBI agent during a sting operation, the men pled guilty to the conspiracy and fraud charges, each facing a maximum penalty of 20 years in prison on each fraud count.
Instead, by virtue of a plea bargain, Ferry will spend one year and three months while Clinton and Martin will spend just 2.5 years behind bars—just 12.5% of the maximum for an illicit scheme in which the trio attempted to defraud a wealthy investor of $1 billion. The three men join co-conspirator Brad Keith Lee (also of California) who was sentenced to 24 months in prison back in 2010 and Oregon's John Brent Leiske, who was sentenced to 120 months in prison on February 14, 2013.
The criminal sentence did not carry with it orders of restitution.
If you have invested with Ferry, Clinton, Martin or his Bankers Trust firm, Lee or any broker or adviser whose misleading or patently false representations concerning high-yield investments or another scheme or fraud has proven harmful to your investments or interests, please call The Law Offices of Jonathan W. Evans & Associates at (800) 699-1881 for an investigation and consultation.
News: Three Investment Advisers Sentenced in California for Roles in $1 Billion High-Yield Investment Fraud (Federal Bureau of Investigation Press Release)