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BOSTON, MA - A Framingham man was arrested and charged today in federal court with perpetrating a large scale “Ponzi” type fraud scheme with approximately 130 victim/investors and losses of as much as $29 million.

United States Attorney Carmen M. Ortiz and Warren Bamford, Special Agent in Charge of the Federal Bureau of Investigation - Boston Field Division, announced today that RICHARD ELKINSON, age 76, of Framingham, MA, was charged in a Criminal Complaint with mail fraud. ELKINSON was arrested in Mississippi.

The Complaint 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) through a Japanese-based manufacturer. ELKINSON allegedly represented that his business involved entering into contracts directly with large purchasers (such as government entities), in which ELKINSON had to pay 50% of the contract amount as a down payment to the manufacturer in order to initiate the manufacturing process. According to the Complaint, upon completion and delivery of the uniforms, ELKINSON reported that he would receive payment from the purchasing entity. ELKINSON claimed that banks were unwilling to lend funds to his business based upon unexecuted contracts, so he needed to borrow a portion of the funds required to pay the 50% down payments.

According to the Complaint, 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 13%. Upon maturity of the notes, investor/lenders were given an option to take a return of their principal and interest, to take interest only, or to roll the principal and interest over into a new note. It is alleged that beginning in April or May of 2009, ELKINSON began to default on making payment on outstanding Promissory Notes, and provided investors with a variety of excuses. In mid-December, ELKINSON missed a scheduled meeting with two investors, and thereafter did not respond to calls to his cell phone. It is further alleged that ELKINSON traveled to Las Vegas, and that various casinos reported that from 1998 to the present, ELKINSON conducted a total of more than $3.7 million in currency transactions over $10,000. Information gathered to date from about 130 investor/lenders reflect that ELKINSON’s current outstanding promissory note obligations are approximately $29 million.

If convicted on these charges, ELKINSON faces up to 20 years imprisonment, to be followed by 3 years of supervised release and a $250,000 fine.

The case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant U.S. Attorneys Mark J. Balthazard and Paul Levenson of Ortiz's Economic Crimes Unit. The investigation has also received assistance from the Securities and Exchange Commission in Boston and 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 Complaint are allegations. The defendant is presumed to be innocent unless and until proven guilty beyond a reasonable doubt in a court of law.


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