Phonenixville Man Sentenced For Multi-Million Dollar Fraud Scheme
PHILADELPHIA - Timothy D. Burns, (36), of Phoenixville, Pennsylvania, was sentenced today to 60 months in prison for mail fraud, wire fraud and loan fraud. He pleaded guilty to the charges on June 25, 2013. Burns was the sole owner of ESG Family Services, among other businesses. ESG Family Services provided bill paying and other personal services to clients. Burns induced many of his Family Services clients to add him as a signatory to their bank accounts. He also represented to clients and others that he could acquire shares of Facebook and other social media stock before their public offerings at favorable prices.
Between at least May 2007 and September 2012, Burns converted money entrusted to him by more than 50 clients and would-be investors for his personal gain. In 2011, without their knowledge or consent, Burns used his clients’ and investors’ money to buy a shore home in Avalon, New Jersey, for more than $4 million and to make a down payment on a commercial office building in Conshohocken, Pennsylvania. In 2012, he misrepresented to a bank that he had acquired stock, when he had not, to obtain a $6 million mortgage loan on the commercial office building. Burns used the fraudulently acquired shore home as collateral on a second loan of $1.5 million issued to him by the same bank to buy the office building.
In addition to the prison term, U.S. District Court Judge Legrome D. Davis ordered restitution of $11,038,923.60, a $400 special assessment, five years of supervised release, and forfeiture.
The case was investigated by the FBI and the U.S. Postal Inspection Service. It was prosecuted by Assistant United States Attorney Nancy E. Potts.