Best Defender Bytes:

April 18, 2016

Valencia Business Man Pleads Guilty to Federal Fraud Charges Related to Precious Metal Investment Scam that Raised $20 Million

Filed under: California Defense Attorney — fayarfa @ 4:55 am

LOS ANGELES – A businessman who prosecutors believe defrauded more than 300 investors in a precious metal investment scam has pleaded guilty to federal fraud and money laundering offenses in a case that caused victims to lose nearly $11 million.

Bruce R. Sands Jr., 54, of Valencia, pleaded guilty yesterday before United States District Judge George H. Wu to four counts of mail fraud, five counts of wire fraud and two counts of money laundering.

Sands owned Superior Gold Group, LLC and Superior Equity Group, LLC, which had offices in Santa Monica, West Hills and Woodland Hills. At times, the companies used an address in Irvine.

According to court documents, from about October 2007 through the end of 2010, the Superior Gold Companies solicited investments in precious metals and collectible coins. Individuals across the nation were solicited through national radio, television and Internet advertising.

Many investors never received the metals they purchased. In court yesterday, Sands admitted he had falsely misrepresented or failed to disclose material information to investors.

According to court documents, Sands falsely told investors that the precious metals they paid for would be delivered to them directly or sent to their retirement accounts, when Sands knew that Superior Gold would not be purchasing or delivering the precious metals.

The government alleges that, as a result of the fraudulent scheme, Sands induced more than 300 victims to invest approximately $20 million and to suffer losses of nearly $11 million while Sands funded his own lavish lifestyle and paid for his own personal expenditures, including payments on his home in Valencia, American Express bills, and luxury vehicles, including a Porsche, a Hummer and a Lincoln SUV.

“The tragedy of this crime is that Mr. Sands preyed on retirees looking for a place to protect their life savings, but he left them financially devastated,” said United States Attorney Eileen M. Decker. “Working with our law enforcement partners, we are completely committed to protecting investors and prosecuting every fraud artist seeking to take hard-earned money from honest citizens.”

“The defendant’s use of client money on personal luxury purchases instead of legitimate precious metals devastated hundreds of lives and caused millions of dollars in losses,” said James L. Struyk, Acting Assistant Director in Charge of the FBI’s Los Angeles Field Office. “Though the lure of a precious metal investment might be great, the public needs to be wary of investing in opportunities which require trusting someone else to buy and deliver precious metals with the risk of never taking possession.”

Sands pleaded guilty less than two weeks before he was scheduled to go on trial.

As a result of his guilty pleas, Sands faces a statutory maximum sentence of 200 years in federal prison and a fine of $2.75 million when he is sentenced by Judge Wu on July 28. Prosecutors intend to ask Judge Wu to order Sands to pay full restitution, which they currently believe would be approximately $10.8 million.

“Illegal activity involving the investment industry has brought financial ruin to many Americans,” stated Acting Special Agent in Charge Anthony J. Orlando of IRS Criminal Investigation. “IRS Criminal Investigation is proud to bring our forensic accounting skills to this joint investigation and help put a stop to this and other types of white collar crime.”

Robert Wemyss, Inspector in Charge, U.S. Postal Inspection Service – Los Angeles Division, stated: “The U.S. Postal Inspection Service will continue to work with our partners in law enforcement to ensure that the U.S. Postal Service isn’t used as a conduit to defrauding the American consumer. The protection of our citizens is at the cornerstone of our mission.”

The investigation of Sands was conducted by the Federal Bureau of Investigation, IRS Criminal Investigation, the United States Postal Inspection Service and the United States Secret Service. The Santa Monica City Attorney’s Office, which was involved in a civil lawsuit against Sands and Superior Gold, provided assistance.

CONTACT: Assistant United States Attorney Sarah J. Heidel  Major Frauds Section   (213) 894-2451

Central District of California DOJ / Release No. 16-074 / April 15, 2016

No Comments »

No comments yet.

RSS feed for comments on this post. TrackBack URL

Leave a comment

Powered by WordPress