LANSING, Mich. (Legal Newsline) -- Michigan Attorney General Bill Schuette this week warned consumers to be cautious when investing, pointing to a Saginaw man's alleged role in what he described as an "extensive" Ponzi scheme.
Schuette announced the filing of charges against Joel Wilson, 30, on Monday after the man allegedly defrauded at least three Michigan victims of hundreds of thousands of dollars.
The charges came as a result of an investigation by the Attorney General's Office.
"Every day, scam artists find new ways to pocket your money," Schuette said.
"Be skeptical of anyone who promises huge returns for a small investment."
Schuette alleges that, beginning in 2009, Wilson scammed investors through his operation of The Diversified Group Advisory Fund LLC, an investment company.
Wilson allegedly told investors that he would use their funds to purchase distressed properties in the Saginaw and Bay City areas. The properties would later be refurbished and sold for profit, which would go to investors.
When funds Wilson collected from the sales of the unregistered securities failed to turn a profit, he allegedly used new investor funds to pay returns to previous investors -- the trademark of a Ponzi scheme, Schuette said.
In addition, Wilson allegedly pocketed about $47,000 of the investment funds to pay his personal expenses and acquire personal assets.
A total of nine charges were filed against Wilson in Bay City District Court Jan. 8.
They include one count of continuing criminal enterprise, or racketeering; three counts of sale of unregistered securities; one count of larceny by conversion ($20,000 or more); one count of larceny by conversion ($1,000-2,000); and three counts of fraudulent sale of securities.
Schuette said arrangements were being made for Wilson to surrender to the proper authorities. Once he is in custody, an arraignment date will be set.
The attorney general said Monday he encourages citizens to "exercise caution" before investing their money with those who promise exorbitant returns.
"Do your homework before handing over your hard-earned money," he said.
"Take your time, ask questions and be sure to confirm your broker is in good standing with the state before signing on the dotted line."
From Legal Newsline: Reach Jessica Karmasek by email at jessica@legalnewsline.com.
Mich. AG warns consumers to be careful when investing
