Statement of United States Attorney Todd Gee Regarding the Arrests in East Mississippi of over 30 Persons for Drug Trafficking, Illegal Firearms Possession, and Other Crimes
Jackson, Miss. – A Jackson attorney pled guilty to conspiracy to defraud investors in a timber deed investment scheme, announced United States Attorney Darren J. LaMarca and Special Agent in Charge Jermicha Fomby of the Federal Bureau of Investigation’s Jackson Field Office.
Jon Darrell Seawright, 50, of Jackson, pled guilty to a Criminal Information charging him with conspiracy to commit wire fraud. Seawright admitted that between 2011 and 2018, he and a co-conspirator participated in a scheme to defraud investors by soliciting millions of dollars under false pretenses and failing to use investor funds as promised. Seawright and his co-conspirator represented to investors that they were in the business of loaning funds to a “timber broker” to buy timber rights from landowners and then to sell the timber rights to lumber mills at a higher price. Seawright and his co-conspirator promised investors a return of 10% or more over twelve or thirteen months on each unit of invested capital. Seawright and his co-conspirator represented to their investors, and led their investors to believe, that Seawright and his co-conspirator were inspecting each tract of land and were vetting each document, deed, and contract in support of their investments. These promises and representations were material in that they were intended to cause investors to believe that their investments were secured by valid assets and to believe that the financial incentives and interests of Seawright and his co-conspirator aligned with those of the investors. In fact, Seawright and his co-conspirator failed to inspect each property related to the timber rights underlying each investment, and they failed to verify each executed lumber mill agreement related to each investment. Seawright and his co-conspirator made few or no such inquiries, and if Seawright and his co-conspirator had made such inquiries, they would have discovered that the timber deeds, lumber mill agreements, and related documents were not valid.
Seawright and his co-conspirator also represented to their investors that Seawright and his co-conspirator would only profit from each series of the investment if it performed as promised to the investors. This gave the investors the misleading impression that their interests were fully aligned with those of Seawright and his co-conspirator. In fact, in addition to receiving a predetermined percentage of return on the investors’ funds, Seawright and his co-conspirator also received undisclosed payments of approximately 3% for recruiting investments to the timber investment scheme immediately upon transferring the investment funds to the purported timber broker. Seawright and his co-conspirator did not disclose to the investors: (a) the fact of these payments, or (b) the amount of the payments in relation to the investments made, or (c) the timing of the undisclosed payments to Seawright and his co-conspirator before any repayment was made to the investors.
Seawright will be sentenced on November 16, 2022, and faces a maximum sentence of up to 5 years imprisonment, three years of supervised release and a fine of up to $250,000. Restitution is mandatory under federal law.
This case resulted from an investigation by the Federal Bureau of Investigation. The case is being prosecuted by Assistant United States Attorney Andrew W. Eichner.