Father And Son Convicted Of Operating $100 Million Ponzi Scheme That Targeted Members Of The Lds Church
PHOENIX. – Guy Andrew Williams, 42, and Brent F. Williams, 66, both of Mesa, Ariz., were convicted by a federal jury in Phoenix on June 28, 2013, of 38 counts of conspiracy, wire fraud, mail fraud, and money laundering. The two-week trial was conducted by U.S. District Judge Jack Zouhary, a visiting judge from the Northern District of Ohio.
U.S. Attorney John Leonardo stated, “Affinity fraud is a particularly reprehensible crime because it depends upon a betrayal of trust to defraud victims of their money. The defendants preyed upon those with whom they made connections through church or in the community. This verdict holds the defendants accountable for their crimes and sends a message to others who would engage in such misconduct.”
FBI Special Agent in Charge Douglas G. Price, Phoenix Division stated, "The guilty verdict rendered in this matter holds Guy and Brent Williams accountable for their actions. The FBI and the IRS are committed to investigating and pursuing those who conspire and prey on trusting individuals for their own personal gain. The FBI and our law enforcement partners will continue to combat fraud as it relates to money laundering, wire and mail fraud."
"The defendants lived lavish lifestyles and enriched themselves at the expense of their unsuspecting investors. This classic Ponzi scheme serves as an unfortunate reminder that everyone should exercise extreme caution before committing their hard-earned money to investment opportunities that promise returns that sound too good to be true" said Dawn Mertz, Special Agent in Charge of the Phoenix Field Office of Internal Revenue Service, Criminal
"This verdict should serve as a strong deterrent to others who would misuse our nation's mail system to commit mail fraud," said Acting Phoenix Division Postal Inspector in Charge Adrian Gonzalez. "The United States Postal Inspection Service remains dedicated to our mission to enforce the laws that defend the nation’s mail system from illegal use and ensure public trust in the mail. Postal Inspectors will continue to partner with fellow law enforcement agencies to bring those perpetuating fraud to justice."
According to the evidence at trial, Guy Andrew Williams and his father, Brent F. Williams, served as the managing director and chief financial officer, respectively, of a group of Mesa, Ariz.-based investment funds known as the “Mathon” entities. The evidence at trial showed that the Mathon entities collected more than $100 million in funds from investors from February 2002 until April 2005.
The evidence at trial further showed that Mathon’s investors, the majority of whom were members of the Church of Jesus Christ of Latter-Day Saints and hailed from Arizona, Utah, and Nevada, were generally told that their money would be used to make short-term loans to third-party borrowers at a high interest rate and that Mathon had an extensive track record of making such loans. In fact, the evidence at trial showed that the defendants, and their business partners, ran Mathon as a Ponzi scheme—that is, by using the overwhelming majority of incoming money from new investors to pay back initial investors. Finally, the evidence at trial showed that the defendants and their business partners paid themselves extravagant salaries and bonuses exceeding $10 million and also used their investors’ money to make millions of dollars of “loans” to companies they secretly controlled.
The sentencing of Guy Andrew Williams and Brent F. Williams is currently scheduled for Sept. 30, 2013, before Judge Zouhary. Also scheduled to be sentenced on that date are Duane Hamblin Slade and Russell Laurence Sewell, two other members of Mathon’s management team who pleaded guilty to related charges before trial.
The defendants face a potential maximum sentence of 20 years in federal prison on each count of conspiracy, wire fraud, and mail fraud, and a potential maximum sentence of 10 years in federal prison on each count of money laundering. Each count also carries a maximum fine of $250,000.
The investigation in this case was conducted by Federal Bureau of Investigation, the Internal Revenue Service, Criminal Investigations Division, the U.S. Postal Inspection Service, and the Securities Division of the Arizona Corporation Commission. The prosecution was handled by Assistant U.S. Attorneys Peter S. Sexton, Kevin M. Rapp, and Dominic Lanza.
CASE NUMBER: CR-09-1492-PHX-ROS
RELEASE NUMBER: 2013-050_Williams
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az