Multi-agency investigations, which included the FBI and the Labor Department, into Ponzi schemes involving retirement accounts have landed two men in prison.
Labor’s Employee Benefits Security Administration announced Wednesday that a fraud investigation by EBSA, the FBI and the Department of Health and Human Services’ Office of Inspector General has resulted in a 12-year prison sentence for an Arkansas man who diverted at least 25 clients’ investments for his personal use.
Another multi-agency federal and state investigation has led to the guilty plea and imprisonment of Ohio businessman William M. Apostelos, who orchestrated a Ponzi scheme that included the theft of $1.9 million from an employee benefit plan. The prosecution was led by the Justice Department.
The investigation of William Jackson Moates Jr., of Fort Smith, Arkansas, found that over the course of nearly five years, Moates, 50, received investment funds from at least 25 different clients, which were not invested as Moates said they would be.
“Moates diverted clients’ investments to his personal use, to pay back other investors, and for the use of his various businesses for operating expenses,” according to EBSA.
EBSA investigators found that Moates had embezzled $150,000 from an employee benefit plan sponsored by a pool company.
Moates used investor funds for home renovations, vacations, credit card payments, payments to personal iTunes and Amazon accounts and contributions to local charities, as well as mortgage payments.
EBSA said he also used investor funds to make disbursements to other clients whose money he had embezzled.