Columbus Businessman Pleads Guilty to Wire Fraud, Money Laundering
COLUMBUS, Ohio – David H. DeMathews, 63, of Columbus, pleaded guilty in U.S. District Court to one count of wire fraud and one count of money laundering.
Benjamin C. Glassman, Acting United States Attorney for the Southern District of Ohio and Angela L. Byers, Special Agent in Charge, Federal Bureau of Investigation (FBI), Cincinnati Field Division, announced the plea entered into yesterday before U.S. District Judge Michael H. Watson.
DeMathews used his positions as Director of National Accounts and Executive Vice President of American Escrow and Title Services, Inc. (AETS), and President of DEMCO Advisory Corporation (DEMCO) to execute a financial fraud scheme.
DeMathews told some victims he would invest their money in the construction of multi-million dollar buildings that were supposed to generate repayment to the investors. He promised some victims he would invest their money in Starbucks franchise opportunities in Central America, hospital projects in Panama and Nicaragua, and a water treatment plant in Florida. He also used some victims’ investments to make partial repayments to other victims, in order to convince those victims that AETS and DEMCO were generating income, and to encourage those victims to make additional investments in AETS and DEMCO.
From 2009 through April 2014, DeMathews had no legitimate income of any kind. He received approximately $911,000 for the purpose of executing his scheme, and misappropriated those funds for primarily his personal use. Those personal expenditures included, but were not limited to: mortgage payments on two houses, numerous lavish big game hunting trips and other vacations to Europe and South Africa, expensive retail purchases, and effectively all of the defendant’s daily living expenses.
DeMathews also used the investors’ money to satisfy monthly restitution payment obligations ordered in the amount of approximately $3.7 million related to a federal criminal case in the Central District of California, in which he was convicted of multiple counts of loan and credit application fraud in April 2000.
He was indicted by a federal grand jury in March 2015.
Wire fraud is a crime punishable by up to 20 years in prison and money laundering in this case carries a potential maximum sentence of 10 years.
Acting U.S. Attorney Glassman commended the investigation of this case by the FBI, and Assistant United States Attorney Jessica H. Kim, who is prosecuting the case.