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NEWS RELEASE

OFFICE OF THE UNITED STATES ATTORNEY

WESTERN DISTRICT OF MISSOURI


JOHN F. WOOD

 


Contact Don Ledford, Public Affairs ● (816) 426-4220 ● 400 East Ninth Street, Room 5510 ● Kansas City, MO 64106

www.usdoj.gov/usao/mow/index.html

 


NOVEMBER 19, 2008

FOR IMMEDIATE RELEASE


OZARK MAN SENTENCED TO 16 YEARS FOR

$2.8 MILLION SECURITIES FRAUD


            SPRINGFIELD, Mo. – John F. Wood, United States Attorney for the Western District of Missouri, announced today that an Ozark, Mo., man has been sentenced in federal court for his role in a scheme that defrauded 115 investors of more than $2.8 million.


Jack A. Calvin, 67, of Ozark, was sentenced by U.S. District Judge Richard E. Dorr on Tuesday, Nov. 18, 2008, to 16 years and eight months in federal prison without parole. The court also ordered Calvin to pay $2,083,736 in restitution to his victims.

 

On Oct. 5, 2007, Calvin pleaded guilty to securities fraud. Calvin admitted that, in the offer and sale of securities, he employed a scheme to defraud, obtained money by means of untrue statements of material facts, and engaged in transactions and business practices that operated as a fraud and deceit upon the purchaser of those securities.

 

Calvin was the primary promoter of Growth Benefit Systems (GBS), a sham letter of credit trading program. From January 1999 through March 2002, he offered and made material misrepresentations about the program to potential and eventual investors. A multi-state network of at least four other individuals acting as brokers helped Calvin carry out his fraudulent offering scheme throughout the United States.

 

Calvin told investors that their funds would be pooled and used in a purported trading program that would yield a return of up to 20 percent per month with little or no investment risk. Calvin told investors that their initial investments would be guaranteed by a promissory note, which purportedly provided an 8 percent return, payable within 13 months. In fact, such bank trading programs do not exist and Calvin and others did not place any of the investors’ funds in the purported trading program. Instead, Calvin and others spent most of the $2.8 million raised from approximately 115 investors for their personal benefit and/or to pay purported “commissions” to themselves and others who helped them perpetrate the fraud.

 

            This case was prosecuted by Special Assistant U.S. Attorneys Silvestre A. Fontes and Louis A. Randazzo, attorneys for the U.S. Securities and Exchange Commission. It was investigated by the U.S. Securities and Exchange Commission.


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This news release, as well as additional information about the office of the United States Attorney for the Western District of Missouri, is available on-line at

www.usdoj.gov/usao/mow/index.html