Justice News

Department of Justice
Office of Public Affairs

Tuesday, July 19, 2011

Richmond, Virginia, Businessman Sentenced to 97 Months in Prison for Role in Investment Fraud Scheme Causing Millions in Losses

WASHINGTON – Julius Everett “Bud” Johnson, 62, a resident of Richmond, Va., was sentenced today to 97 months in prison for his role in an investment scheme resulting in millions of dollars in losses, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, U.S. Attorney Neil H. MacBride of the Eastern District of Virginia, Acting Special Agent in Charge Jeannine A. Hammett of the Internal Revenue Service-Criminal Investigation (IRS-CI) and Special Agent in Charge Michael Morehart of the FBI Richmond Field Office.


On April 11, 2011, Johnson pleaded guilty before U.S. District Chief Judge James R. Spencerto one count of conspiracy to commit mail, wire and bank fraud and one count of engaging in unlawful monetary transactions. A hearing will be held before Judge Spencer in Richmond on Sept. 29, 2011, to determine the amount of restitution , which, according to the plea documents, is currently estimated to be approximately $8.9 million.


According to court filings, from prior to July 2009 until at least March 2010, Johnson owned and operated several businesses based in Richmond, including Virginia Group Benefits (VGB); Mid-Atlantic Insurance (MAI); F.I.C. Financial Group Inc.; Benefit Contractors Administrators Inc. (BCA); River City Cleaners LLC; Roberts Awning LLC; Norvell Awning LLC; MHC Linen Services LLC; The Everett Group; and Living Well. Johnson and his coconspirator offered investments in the different businesses, generally including a promise of returns of up to 10 percent within one to four years.  Johnson and his coconspirator represented to potential investors that their investment funds would be funneled directly into specific companies, which would generate the returns on investment. Instead, a significant portion of the invested funds was used to repay other investors and to cover operating costs for unrelated businesses.


The case was prosecuted by Trial Attorney Kevin B. Muhlendorf of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Mike Gill of the Eastern District of Virginia.  The case was investigated by the IRS-CI, FBI and the Virginia State Corporation Commission Bureau of Insurance.


This prosecution was brought in coordination with President Barack Obama’s Financial Fraud Enforcement Task Force. President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes. For more information about the task force visit: www.stopfraud.gov .

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Updated September 15, 2014