Steven Jones, 46, Charlotte, North Carolina, was convicted after a three-day trial of racketeering conspiracy, securities fraud, wire fraud scheme to defraud investors and money laundering conspiracy. His conviction is the latest in Operation Wax House, an investigation which began in 2007 and has netted 91 defendants to date, 86 of which have pleaded guilty or been convicted following a trial.
The federal criminal trial began on Monday, June 23, 2014, before Senior U.S. District Judge Graham C. Mullen. According to evidence introduced at trial, the criminal enterprise operated from about 2005 until 2012, and engaged in an extensive pattern of racketeering activities, which included investment or securities fraud, mortgage fraud in the form of wire fraud and bank fraud, and money laundering.
According to trial evidence, Jones was a promoter in the enterprise’s investment fraud operations, bringing in multiple investors, including an attorney, who Jones and his co-conspirators defrauded out of $3.7 million. Trial evidence established that throughout a seven year period the enterprise created a series of sham corporations to convince individuals to invest money. When investors would become aware of the problems with one corporation the enterprise would start a new corporation with new officers on paper to continue to defraud still further investors, court records show.
Trial evidence also showed that Jones and others defrauded victims not of just money they had, but also caused the victims to take out expensive loans and to invest those loan proceeds based on false promises. According to evidence presented at trial, Jones and his co-conspirators used the investors’ money for personal expenditures, including private jets, high profile offices, entertaining themselves and others, and supporting their luxurious lifestyles. In total, the enterprise’s investment fraud operations took approximately $48 million from investors.
Following the jury’s conviction, Jones was released on home detention with electronic monitoring pending the scheduling of his sentencing hearing.
The racketeering conspiracy charge carries a maximum term of 20 years in prison and a $250,000 fine or twice the gross profits or other proceeds. The securities fraud charge carries a maximum term of 20 years in prison and a $250,000 fine. The wire fraud charge carries a maximum term of 20 years in prison and a $250,000 fine. The money laundering conspiracy charge carries a maximum term of 20 years in prison and a $500,000 fine or twice the amount of criminally derived proceeds. A sentencing date for the defendant has not been set yet.
Five defendants have charges pending in the case, two of which are international fugitives. Each remaining defendant and his or her status are listed below.
Ramin Amini, 45, Tehran, Iran, is charged with racketeering conspiracy, mortgage fraud and money laundering conspiracy. Role: Leader and promoter in the scheme. Status: International fugitive.
Kurosh Mehr, 52, Charlotte, North Carolina, is charged with racketeering conspiracy, mortgage fraud and money laundering. Role: Promoter and buyer. Status: On bond; Scheduled for trial September 2014.
Ann Tyson Mitchell, 62, Charlotte, is charged with racketeering conspiracy, mortgage fraud and money laundering. Role: Facilitator. Status: On bond; Scheduled for trial September 2014.
John Wayne Perry, Jr., 32, Charlotte, is charged with racketeering conspiracy and money laundering conspiracy. Role: Promoter. Status: On bond; Scheduled for trial after September 2014.
Nazeere Saddig, 41, formerly of Charlotte, is charged with racketeering conspiracy and mortgage fraud. Role: Promoter and buyer. Status: International Fugitive.
U.S. Attorney’s Office for the Western District of North Carolina announced the verdict.
The United States Attorney’s Office is joined in making the announcement by John A. Strong, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division, and Thomas J. Holloman III, Special Agent in Charge of the Internal Revenue Service, Criminal Investigation Division (IRS-CI) and North Carolina Secretary of State Elaine F. Marshall.
Operation Wax House in the Western District of North Carolina is being handled by the Charlotte Division of the FBI and the Criminal Division of the IRS for the Financial Fraud Enforcement Task Force, along with the Securities Division of the North Carolina Secretary of State. The case was tried by Assistant United States Attorney Maria K. Vento and Special Assistant United States Attorney Kevin Harrington, of the Securities Division of the North Carolina Secretary of State.