Indianapolis Man Pleads Guilty To Defrauding Investors In Ponzi Scheme Involving Fictitious Online Credit Union
ALEXANDRIA, Va. – Timothy J. Coughlin, 63, of Indianapolis, Indiana, pleaded guilty today to committing wire fraud and impersonating an Internal Revenue Service official while operating the Oxford International Credit Union (OICU), which Coughlin used to solicit online investments.
Dana J. Boente, U.S. Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Andrew Ceresney, Director, Division of Enforcement, U.S. Securities and Exchange Commission (SEC); and J. Russell George, Treasury Inspector General for Tax Administration (TIGTA), made the announcement after the plea was accepted by U.S. District Judge Leonie M. Brinkema.
According to a statement of facts filed with the plea agreement, from around 2006 through March 2014, Coughlin operated OICU and anotheronline investment vehicle known as the Oxford International Cooperative Union. Investors paid annual dues to participate in the Oxford entities and made investments in OICU through online payment processors. As part of the scheme, Coughlin created a website through which he posted false information to investors’ online accounts indicating that their deposits were earning significant daily returns, which averaged 0.471% each trading day from January 2007 through December 2009 (equivalent to a 356% approximate rate of return over that time period). To further the fraud, Coughlin posted a fake certificate stating that OICU was an insured credit union, and he also made audio recordings in which he falsely claimed that members were earning significant returns on their investments.
By the end of 2009, Coughlin had ceased approving requests for account withdrawals from investors, claiming that taxing authorities in the United States and Canada were freezing Oxford’s assets abroad. In January 2012, Coughlin falsely announced to investors that he had reached an agreement to resolve the tax issues, and he created a fictitious agreement on which he forged the signatures of an actual IRS employee in Washington, DC and a lawyer based in New York.
During the course of this fraudulent scheme, Coughlin received nearly $15 million from almost 5,000 people for investments and members’ annual dues. Before December 2009, Coughlin approved about $4.4 million in withdrawal requests by investors.
Coughlin faces a maximum penalty of 23 years in prison when he is sentenced on Sept. 26, 2014.
This case was investigated by the FBI’s Washington Field Office, SEC, and TIGTA. Assistant U.S. Attorney Jack Hanly is prosecuting the case.
A copy of this press release may be found on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 1:14-cr-221.