News and Press Releases

RENTON MAN PLEADS GUILTY TO MAIL, WIRE AND SECURITIES FRAUD

FOR IMMEDIATE RELEASE
April 8, 2005

RICHARD THOMAS ZIESKE, 42, of Renton, Washington, pleaded guilty today in Federal Court in Seattle to Mail Fraud (Count 11), Wire Fraud (Count 29), and Securities Fraud (Count 57) in connection with a scheme that defrauded more than 50 Washington State investors of approximately $1.2 million. ZIESKE will be sentenced by Judge Marsha J. Pechman on July 15, 2005.

According to a 59-count indictment returned by a Federal Grand Jury in August 2004, ZIESKE held himself out to investors as a successful day-trader who would be able to generate significant returns in short periods of time. ZIESKE was not, in fact, a successful day-trader and was never licensed or authorized to sell securities. He was not registered as a financial advisor with the State of Washington and the securities that ZIESKE sold also were not registered with the State of Washington.

Beginning in 1999 and continuing into June 2002, ZIESKE solicited investments in various interests he controlled, namely, Grace E-DAT, Inc.; Grace E-Dat02 LP (a limited partnership), and Grace Capital Investments LLC, (a limited liability company). Overall, ZIESKE obtained a total of approximately $2,294,922. ZIESKE continually told investors that he had made substantial gains day-trading in stocks, when in fact he had suffered significant losses. In one instance, according to the victims, ZIESKE represented to a group of investors that he was able to purchase private shares in the investors' names in a company prior to an initial public offering. In fact, he purchased no shares in the investor's names and there was no such public offering. ZIESKE has agreed to pay more than $1,000,000 in restitution to the victims of his scheme.

In order to continue day-trading in the face of continual losses he was incurring, ZIESKE required more and more money. Accordingly, he used new investment funds to pay earlier investors, and thereby lulled these and new investors into believing that his day-trading activities were profitable. ZIESKE also used investor money for his personal expenses. Many of the investors were solicited at ZIESKE's church, Christian Faith Center in Burien.

Mail Fraud and Wire Fraud are punishable by up to 20 years in prison. Securities Fraud is punishable by up to10 years in prison. A fine of up to $250,000 may be imposed as to mail and wire fraud and up to $1,000,000 as to securities fraud.

The case was investigated by Washington State Department of Financial Institutions, Securities Division, and the Federal Bureau of Investigation, and prosecuted by Assistant United States Attorney Susan B. Dohrmann.

For additional information please contact Lawrence Lincoln, Assistant United States Attorney, at (206) 553-7970.

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