FourWinds C.E.O. Stanley Bates Sentenced to 15 Years in Federal Prison
In San Antonio today, a federal judge sentenced former FourWinds Chief Executive Officer Stanley P. Bates to
15 years in federal prison, announced U.S. Attorney John F. Bash, Federal Bureau of Investigation Special Agent in Charge Christopher Combs, San Antonio Division, and Internal Revenue Service-Criminal Investigation Special Agent in Charge D. Richard Goss, Houston Field Office.
In addition to the prison term, Senior U.S. District Judge David A. Ezra ordered that Bates pay $6,345,414 million restitution and be placed on supervised release for a period of three years after completing his prison term.
“Today Mr. Bates received a just punishment for the fraudulent scheme he orchestrated. Like all such schemes, the FourWinds plot, stripped to its core, was simply an effort to steal money belonging to other people,” stated U.S. Attorney Bash.
On January 8, 2018, Bates pleaded guilty to eight separate federal charges including securities fraud and money laundering stemming from a Ponzi scheme that defrauded investors out of millions of dollars. In February, a jury found Bates’s co-defendants, former District 19 Texas State Senator Carlos Uresti and FourWinds Logistics, Inc., (FourWinds) consultant Gary L. Cain, guilty on all charges for their roles in the scheme. In June, Judge Ezra sentenced Uresti and Cain to 12 years in federal prison and 68 months in federal prison, respectively. Judge Ezra also ordered that Uresti and Cain pay, jointly and severally, over $6.3 million in restitution.
Evidence presented during trial revealed that from February 2014 to December 2015, the defendants developed an investment Ponzi scheme to buy and sell hydraulic fracturing (fracking) sand for oil production. Evidence showed that the defendants made false statements and representations while soliciting investors in FourWinds. Collected funds were then used to pay earlier investors and for personal expenses including gifts, travel, luxury automobiles, controlled substances, and to hire prostitutes. Evidence and testimony also revealed that Uresti, Cain and Bates engaged in money laundering with the proceeds of wire fraud.
The FBI’s Public Corruption Task Force is conducting this investigation. The Task Force is comprised of investigators from the FBI, IRS-CI, Texas Department of Public Safety (DPS) and the Peace Corps-Office of Inspector General. Assistant U.S. Joseph E. Blackwell, William R. Harris, Mark Roomberg, Erica Giese and Sean O’Connell are prosecuting this case on behalf of the Government.