Fugitive Convicted of Running Ponzi Scheme Involving Distressed Properties

Allison Tussey —  March 5, 2015 — Leave a comment

Joel Wilson, 32, Saginaw, Michigan, was convicted by a jury on nine felony charges for his role in an extensive Michigan Ponzi scheme wherein he defrauded hundreds of Michigan victims out of millions of dollars. In January 2014, extradition efforts were initiated to retrieve Wilson from Germany after he was on the lam in Europe for more than a year.

As investigators closed in on Wilson’s operation in late 2012, he fled the country for Germany.  Multiple criminal charges were filed 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, notification from INTERPOL was received 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, Michigan 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 of the following charges filed in Bay County District Court on January 8, 2013:

  • One count of Continuing Criminal Enterprise (Racketeering), a felony punishable by up to twenty years in prison;
  • Three counts of Sale of Unregistered Securities, a felony punishable by up to ten years in prison;
  • One count of Larceny by Conversion ($20,000 or more), a felony punishable by up to ten years in prison;
  • One count of Larceny by Conversion ($1,000-$20,000), a felony punishable by up to five years in prison; and,
  • Three counts of Fraudulent Sale of Securities, a felony punishable by up to ten years in prison.

Following the 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, felony charges were announced 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.

Attorney General Bill Schuette announced the conviction.

“I am pleased we have secured justice for the vicitms 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.”

 

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Allison Tussey

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