A man has pleaded guilty in federal court in Pennsylvania to perpetrating a loan scheme that netted a significant profit. The man, age 34, entered a guilty plea during proceedings on March 18. He was accused of federal fraud of nearly $4 million, having allegedly taken money from people who were looking for loans for their humanitarian endeavors.
Authorities say that the man established a company called Worldwide Funding. The man was accused of convincing at least three dozen investors that they could receive significant loans after providing an initial investment. Those individuals reportedly handed over between $60,000 and $90,000 after being promised overseas loans of 10 million euros in exchange. That would be the equivalent of about $14 million, according to industry experts.
The defendant was accused of telling investors that they could essentially receive the money at no cost, since the loans would fund a bank program that would pay the loan off on its own. He promised investors that their money would generate a 14 percent weekly return. Instead, prosecutors said that the man took about 45 percent of the investors' money, spending it on expensive trips, dinners, and objects such as clothing and cars. Meanwhile, the man was accused of telling investors that they only needed to wait for the loan process to be approved.
The man is just one of the more than 200 individuals that have been targeted by federal investigators for securities fraud since 2010. News reports do not describe the exact charges that the man faces. Those reports also have not revealed potential penalties for the man's admitted crimes.
Criminal defendants who are considering pleading guilty to federal fraud charges may benefit from consulting a Pennsylvania attorney. These professionals can provide additional information about plea options and defendants' rights. An arrest and indictment for fraud does not mean that a defendant is automatically considered guilty.
Source: Pittsburgh Tribune-Review, "Florida man pleads guilty in Pittsburgh federal court to scam netting $3.9 million" Adam Brandolph, Mar. 19, 2014