March 5, 2015
LANSING – Attorney General Bill Schuette today announced a Bay County jury has convicted Joel Wilson, 32, of Saginaw, on nine felony charges for his role in an extensive Michigan Ponzi scheme. Wilson defrauded hundreds of Michigan victims out of millions of dollars. In January 2014, Schuette launched extradition efforts to retrieve Wilson from Germany after he was on the lam in Europe for more than a year. The charges were filed following an Attorney General investigation.
"I am pleased we have secured justice for the victims who lost their life savings," said Schuette. "Financial exploitation is a growing crime in Michigan, and we are cracking down on these con artists. Be skeptical of anyone who promises huge returns for a small investment."
As Attorney General investigators closed in on Wilson's operation in late 2012, he fled the country for Germany. Schuette filed multiple criminal charges against Wilson in January 2013 and worked with federal officials to issue a warrant for his arrest in Europe. On January 20, 2014, Wilson was arrested in Germany by Dresden Police. On January 21, 2014, Schuette's office received notification from INTERPOL that Wilson had been arrested by European law enforcement and summarily filed paperwork to extradite Wilson from Germany to face trial for his pending criminal charges in Michigan. Wilson was successfully extradited on May 15, 2014.
Beginning in 2009, Wilson scammed investors through his operation of The Diversified Group Advisory Fund LLC, an investment company. Wilson 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 used new investor funds to pay returns to previous investors - the trademark of a Ponzi scheme. In addition, Wilson pocketed approximately $583,000 of the investment funds to pay his personal expenses and acquire personal assets.
Additionally, Wilson failed to disclose the risks associated with the actual investment in question—a highly leveraged real estate investment that could result in the loss of all of the investors' money. Many investors, including senior citizens, risked their life savings.
Wilson was convicted today of the following charges filed in Bay County District Court on January 8, 2013:
Following Schuette's felony charges against Wilson, additional victims have come forward with allegations against Wilson and the Diversified Group. Wilson may face additional charges pending the outcome of investigation into those cases.
Wilson, who is currently being held in Bay County Jail, will return for sentencing in Bay County Circuit Court before Judge Joseph K. Sheeran on April 27, 2015 at 1:30 pm.
In September 2013, Schuette announced felony charges against a second person for perpetrating Wilson's scheme. In March 2014, Shawn Dicken, 40, Bay City, was convicted of nine felonies, one count of Criminal Enterprises, one count of Embezzlement From A Vulnerable Adult, and seven counts of False Pretenses. Dicken was sentenced on June 19, 2014 to 11 years, eight months to 20 years in prison by Midland County Circuit Court before Judge Stephen P. Carras.
Dicken was convicted of charges concerning her role as a salesperson in the Diversified Group Advisory Firm LLC Ponzi scheme. Dicken allegedly failed to disclose the risks associated with the actual investment in question - a highly leveraged real estate investment that could result in the loss of all of the investors' money. Many investors risked their life savings. Dicken swindled investors out of more than two million dollars by using dishonest tactics. Investigation revealed Dicken allegedly took an eight percent commission, pocketing approximately $160,000 for herself.
Citizens who believe they may have been victims of Joel Wilson or The Diversified Group are encouraged to file complaints with the Attorney General's Office.
Schuette encourages Michigan citizens to exercise caution before investing their money with those who promise exorbitant returns.
"Do your homework before handing over your hard-earned money," said Schuette. "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."
Key tips to avoid falling victim to a Ponzi scheme or investment fraud include:
Check out your broker or adviser. Confirm that your broker or financial adviser is registered and in good standing. Contact the Bureau of Commercial Services with the Department of Licensing and Regulatory Affairs, at 517-241-6345, to check out your broker or adviser.
Take your time - don't be rushed into investment decisions. Salespersons who use high-pressure tactics to force an investor into an immediate decision are almost always pitching frauds. They don't want you to think too carefully or find out too much because you may figure out that it's a scam.
Keep tabs on your investments. Be wary when a financial planner says "leave everything to me," or "the plan is too complicated to tell you." Everything should be clear and explainable to you.
Monitor the activity on your account. Insist on receiving regular statements.
Ask Questions. Never be embarrassed or apologetic about asking questions for trading activity that looks excessive or unauthorized. It's your money, not your broker's.
Keep Diligent Records. Keep all of your records relating to your investments, including notes of conversations you have with brokers, salespeople, and financial advisers.
Consumers can find helpful advice and a list of questions to consider in Attorney General Schuette's Consumer Alert for Ponzi Schemes, available on Schuette's website. Attorney General Schuette also offers specialized consumer advice for Michigan seniors on how to avoid investment fraud through the Senior Brigade website.