News and Press Releases RSS feed

FRAMINGHAM MAN INDICTED FOR MULTI-MILLION DOLLAR INVESTMENT FRAUD SCHEME

February 18, 2010

BOSTON, MA - An Indictment was returned late yesterday charging a Framingham man with perpetrating a large scale investment fraud scheme with approximately 130 victim/investors and losses in the millions of dollars.

United States Attorney Carmen M. Ortiz and Warren Bamford, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division, announced that RICHARD ELKINSON, age 76, of Framingham, MA, was charged in a Indictment with mail fraud. ELKINSON was arrested on January 5, 2010 in Mississippi on a Criminal Complaint and has been held in custody since that time.

The Indictment alleges that ELKINSON held himself out as being in the business of brokering contracts for the purchase of uniforms (such as police uniforms, prison uniforms and the like) and hats through a Japanese manufacturer. ELKINSON allegedly represented that his business involved entering into contracts directly with state governments to supply such uniforms and hats, and that ELKINSON was responsible for advancing 50% of the contract amount to the manufacturer to finance production of the uniforms and hats. According to the Indictment, ELKINSON represented that upon delivery of the uniforms, he collected payment from the state governments, and was responsible for distributing the proceeds to the manufacturer and to ELKINSON’s investors.

According to the Indictment, the vehicles for ELKINSON’s borrowing were Promissory Notes, in varying amounts, with terms that generally required repayment within a term of 330-360 days, and with interest rates that ranged from 9% to 15%. ELKINSON told investors that their investments were for specific uniform or hat contracts, and the promissory notes usually contained notations which appeared to reflect that. Upon maturity of the notes, ELKINSON persuaded many of his investors to “rollover” all or part of their investment in a new uniform or hat contract. It is alleged that beginning in early 2009, ELKINSON began to default on making payment on outstanding Promissory Notes, and provided investors with a variety of excuses. It is alleged that all of ELKINSON’s representations to investors concerning his involvement in a uniform and hat business were false, and that ELKINSON repaid investors who requested payment on notes due with money he received from other investors.
If convicted, ELKINSON faces up to 20 years imprisonment on each count, to be followed by 3 years of supervised release, a $250,000 fine, an order of restitution and forfeiture of assets.

The case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorney Mark J. Balthazard of Ortiz's Economic Crimes Unit. The investigation has also received assistance from the Securities and Exchange Commission in Boston and from the Securities Division of the Massachusetts Secretary of State.

In an effort to keep potential victims informed of the developments in this criminal case, scheduled court dates for significant events and public court documents will be posted on the U.S. Attorney’s Office website at WWW.USDOJ.GOV/USAO/MA. Potential victims may also call the U.S. Attorney’s Office’s victim assistance toll-free number at 888-221-6023 to obtain status information.

The details contained in the Indictment are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.

 

Return to Top

USAO Homepage
USAO Briefing Room
Boston Marathon - Updates / Resources

Receive information regarding those charged in the Boston Marathon bombing cases.

Financial Fraud Enforcement Task Force

Financial Fraud Enforcement Task Force

Victim Witness Assistance

Making sure that victims of federal crimes are treated with compassion, fairness and respect.

Stay Connected: Visit us on Twitter

Stay Connected: Visit us on Twitter