January 17, 2008
For more information contact:
Managing Assistant U.S. Attorney Dixie A. Morrow
(850) 444-4000
FINAL DEFENDANT OF NATIONWIDE PYRAMID SCHEME CONVICTED OF
WIRE FRAUD, SECURITIES FRAUD AND MONEY LAUNDERING CONSPIRACIES
Pensacola, Florida - Gregory R. Miller, United States Attorney for the Northern District of Florida, announced that 69-year old Jerrold L. Gunn, a Canadian citizen and retired attorney, was convicted yesterday afternoon of conspiracy to commit wire fraud and securities fraud and of conspiracy to commit money laundering. The guilty verdicts followed a week and half long trial before Senior United States District Judge Lacey A. Collier.
Gunn turned himself in to the United States Marshals’ Service on August 30, 2007, after losing his fight against extradition to the United States following his indictment on June 21, 2000. Gunn is the final defendant to be convicted for his role in a multi-million dollar “pyramid” scheme which purported to offer investors high-yield returns on investments operated by “Bridgeport Alliance.” Twelve others have been convicted in prior proceedings, including William West of Niceville, Florida, currently serving a 136-month sentence. Previous sentences have ranged from 63 to 156 months in prison.
The investments were claimed to be a secret program to purchase United States Treasury obligations and leverage them to earn returns of 360% per year and higher. The investment programs, operated under the names “Hammersmith Trust” and “Microfund,” never actually existed. Instead, the investors’ money was used to pay earlier investors in order to promote and continue the fraud. Throughout the fraud, the investors’ money was laundered through a number
of corporate accounts until finally disbursed to the use and benefit of the defendants. The organization took in approximately $60 million from investors during the life of the conspiracies. Trial evidence showed that Gunn structured the contracts, kept the true purpose of the scheme secret and away from regulators, vouched for the programs’ success, and created an offshore bank called “AmPac” in order to launder investment funds.
Gunn is scheduled to be sentenced on April 8, 2008. He faces a maximum of five (5) years imprisonment, a $250,000 fine, and 3 years of supervised release for the wire fraud and securities fraud conspiracy, and a maximum of ten (10) years imprisonment, a $250,000 fine, and 3 years of supervised release for the money laundering conspiracy. As a result of the conviction, Gunn also faces criminal forfeiture of all property, real or personal, involved in the offenses.
This case was investigated by the Internal Revenue Service - Criminal Investigation, the U.S. Department of Homeland Security Bureau of Immigration and Customs Enforcement, the Federal Bureau of Investigation, and the Florida Department of Financial Investigation. The case is being prosecuted by Assistant U.S. Attorney Michelle M. Heldmyer.