FRIDAY, MARCH 1, 2013
Reno Financial Advisor to Appear in Federal Court Today on Investment Fraud Charges
RENO, Nev. – A former financial advisor with Bank of America who was indicted in August 2012 on felony mail fraud and tax evasion charges, is scheduled to make an initial appearance in federal court today to answer charges that he defrauded six persons of over $2 million from 2010 to 2011 in an investment fraud scheme, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
Gary H. Lane, 59, of Reno, is scheduled to appear at 3:00 p.m. today before U.S. Magistrate Judge Valerie P. Cooke for an initial appearance and arraignment. Lane is charged with 12 counts of mail fraud and five counts of attempt to evade or defeat tax. Lane has been in state custody on an unrelated matter, and thus was unable to make an appearance on the federal charges until today.
According to the indictment, Lane was employed as a financial advisor by Bank of America Investment Services, which later merged with Merrill Lynch, until March 2011. During the course of Lane’s employment, he allegedly developed a scheme to entice persons to invest monies with him through the use of an E-Trade account rather than through normal bank procedures. Lane allegedly looked for investors who were elderly or lacked investing experience and had a desire for high returns and aversion to risk. Lane told the investors that their funds would be invested in U.S. Treasury Bonds which would pay better than six percent interest and would mature in two years. Lane corroborated the trades by creating false confirmations and distributing them to the victims by mail. After receiving the monies from the victims, Lane gave them to his spouse who mailed them to her E-Trade account. The monies were then withdrawn at Lane’s direction for his own use or to pay other investors. In actuality, Lane never purchased any U.S. Treasury Bonds with the victims’ monies. In fact, there were never any United States Treasury Bonds that existed with a rate of return of greater than six percent and a maturity period of less than two years.
Using this scheme, the indictment alleges that Lane defrauded approximately six victims of over $2 million between January 2010 and March 2011. Lane also allegedly filed false and fraudulent individual tax returns for the years 2006 through 2010, substantially understating his income and tax due and owing to the IRS.
If convicted, Lane faces up to 20 years in prison for each mail fraud count and up to five years in prison on each tax count, as well as fines of up to $250,000 per count.
The case is being investigated by the FBI, IRS Criminal Investigation and the Nevada Secretary of State Securities Division, and is being prosecuted by Assistant U.S. Attorney Ronald C. Rachow.
This case was handled in connection with the President's Financial Fraud Enforcement Task Force. The task force was established to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. With more than 20 federal agencies, 94 U.S. attorneys' offices and state and local partners, it's the broadest coalition of law enforcement, investigatory and regulatory agencies ever assembled to combat fraud. Since its formation, the task force has made great strides in facilitating increased investigation and prosecution of financial crimes; enhancing coordination and cooperation among federal, state and local authorities; addressing discrimination in the lending and financial markets and conducting outreach to the public, victims, financial institutions and other organizations. Over the past three fiscal years, the Justice Department has filed nearly 10,000 financial fraud cases against nearly 15,000 defendants including more than 2,900 mortgage fraud defendants. For more information on the task force, please visit www.StopFraud.gov.
An indictment contains only charges and is not evidence of guilt. The defendant is presumed innocent and is entitled to a fair trial at which the government has the burden of proving guilt beyond a reasonable doubt.