Financial Advisor Pleads Guilty in $1.1 Million Investment Fraud Scheme
COLUMBUS, Ohio – Mark F. Speakman, 60, of Grove City, Ohio, pleaded guilty in U.S. District Court today to one count each of wire fraud, money laundering and filing a false federal income tax return with the Internal Revenue Service (IRS). As part of his offered guilty plea, he agreed to pay nearly $1.2 million in restitution to the victims of his investment fraud scheme.
Benjamin C. Glassman, United States Attorney for the Southern District of Ohio, Kathy A. Enstrom, Special Agent in Charge, Internal Revenue Service (IRS), Criminal Investigation, Cincinnati Field Office, and Grove City Police Chief Jeff Pearson announced the guilty plea offered today before U.S. Magistrate Judge Norah McCann King.
According to court documents, between 2000 and 2015, Speakman was a financial advisor at Ameriprise Financial, and between 2002 and 2015 Speakman defrauded his clients by misappropriating their funds.
Speakman persuaded his clients to remove their funds from their Ameriprise Financial accounts and invest them in Centrax, a fraudulent real estate investment trust. Rather than investing the funds in real estate, he stole the money. He took $870,000 from seven victims for the real estate scheme and used the money to pay his own expenses.
As part of this same scheme to defraud, Speakman stole from others to avoid detection by a client he had previously defrauded. In 2014, one of his clients who had previously agreed to invest in Centrax told Speakman that he wanted to cash out his investment. Speakman had already misappropriated those funds and had no way to pay back his client.
Speakman convinced another client and three of their family members to invest in gold coins so he could divert the money in order to pay back the previous victim.
In total, Speakman received $1,192,450 from others in furtherance of his fraudulent scheme.
In addition, Speakman filed a false federal income tax return with the IRS for the 2014 income tax year on which he omitted $275,000 in income generated by his fraudulent conduct. The total tax loss to the IRS for 2002 through 2014 was approximately $300,000.
"This investigation uncovered a complicated investment fraud scheme laced with a web of financial lies that generated more than a million dollars through false promises and deceit,” said Kathy A. Enstrom, Special Agent in Charge, Criminal Investigation, Cincinnati Field Office. “Investment fraud schemes are often described as a house of cards. The underlying structure can fall apart at any time and expose the individuals responsible."
Wire fraud is a crime punishable by up to 20 years of imprisonment; money laundering is a crime punishable by up to 10 years in prison and filing a false income tax return is a crime punishable by up to three years of prison time.
U.S. Attorney Glassman commended the investigation of this case by the IRS and the Grove City Police Department, and Assistant U.S. Attorney Peter K. Glenn-Applegate, who is prosecuting the case.