News and Press Releases

FOR IMMEDIATE RELEASE:

WEDNESDAY - January 6, 2010

MAN RECEIVES 10-YEAR SENTENCE FOR ROLE

IN $70 MILLION PONZI SCHEME

RALEIGH - United States Attorney George E.B. Holding announced yesterday’s sentencing in a significant fraud case brought by the United States. On January 4, 2010, in Raleigh, North Carolina, Senior United States District Judge W. Earl Britt sentenced MICHAEL L. YOUNG, the final defendant convicted in the $70 million Mobile Billboards of America Ponzi scheme.

YOUNG, 63, was sentenced pursuant to his guilty pleas to conspiring to commit mail fraud in connection with the Mobile Billboards investment and failing to appear for his criminal trial in January, 2008. YOUNG had left the United States and was in Dubai at the time.

Yesterday, YOUNG received a sentence of 10 years imprisonment for his crimes. He was also ordered to pay in excess of $45 million in restitution.

YOUNG had served as President of Mobile Billboards of America, Inc., which purported to be a legitimate “business opportunity” for investors seeking monthly income during retirement. In exchange for investments in increments of $20,000, investors were promised they would receive “guaranteed” monthly checks based on a return of 13.49% and the return of their entire investment at the end of seven years. Investors were told their $20,000 was used to purchase billboards on the sides of trucks, and that advertising revenue from those billboards was used to make the monthly payments.

In fact, Mobile Billboards was operated as a fraudulent Ponzi scheme, where investments by new investors were used to make payments to previous investors, and to enrich the defendants. In September, 2004, the United States Securities and Exchange Commission sued the company, and it was discovered that Mobile Billboards had almost no advertising revenue compared with the number of investments sold. Further, it was discovered that there were no known billboards operating on the sides of trucks; instead, thousands of unassembled billboard parts were found in a warehouse in Brevard, North Carolina.

Approximately $55 million was taken in through the Mobile Billboards fraud scheme; another $16 million was taken in through a previous, related scheme under the name “National Payphone Corporation.” Investors were solicited by a network of “sales agents” – typically insurance agents.

Five other defendants were previously convicted and sentenced in this case. They are: MICHAEL A. LOMAS; LAURINDA HOLOHAN; SUSAN KNIGHT; ARTHUR J. ANDERSON, JR.; and SCOTT B. HOLLENBECK. All defendants are currently incarcerated, with LOMAS and HOLLENBECK serving sentences of 20 years and 14 years, respectively.

This defendant and his co-conspirators perpetrated a sophisticate fraud scheme on elderly investors in North Carolina and elsewhere, and this sentence is just,” said United States Attorney George E.B. Holding. “In order to guard against such fraud schemes, citizens are reminded that, if an investment seems too good to be true, it almost certainly is.”

Investigation of the case was conducted by the United States Postal Inspection Service, the Federal Bureau of Investigation, and the North Carolina Department of State, Securities Division. The case was handled by the Economic Crimes Section of the U.S. Attorney’s Office, with Assistant United States Attorneys Clay C. Wheeler and Jason H. Cowley prosecuting the case for the United States.

News releases are available on the U. S. Attorney’s web page at www.usdoj.gov/usao/nce within 48 hours of release.

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