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Date: 02-24-2022
Case Style:
Case Number: 2:19-cr-00047-RAJ-LRL-2
Judge: Raymond A. Jackson
Court: United States District Court for the Eastern District of Virginia (Norfolk County)
Plaintiff's Attorney: United States Attorney’s Office
Defendant's Attorney:
Description: Norfolk, Virginia criminal defense attorney represented defendant charged with conspiracy to commit mail and wire fraud, wire fraud, and money laundering, in connection with a nationwide investment scheme involving fraudulent wireless spectrum and dental franchise investments.
According to court records and evidence presented at trial, from approximately 2011 through 2017, David Alcorn, 78, of Scottsdale, Arizona, and Aghee William Smith II, 70, of Roseville, California, were part of an investment fraud conspiracy that operated out of California, Arizona, Florida, Idaho, and Hampton Roads, among other locations across the country. Alcorn, Smith, and their co-conspirators—including Kent Maerki, 78, and his wife Norma Jean Coffin, 60, of Arizona, Daryl Bank, 51, of Florida, insurance salesman Tony Sellers, 62, of Idaho, insurance salesman Tom Barnett, 69, of California, attorney Billy Seabolt, 56,, of Williamsburg, Raeann Gibson, 49, of Florida, and Roger Hudspeth, 51, of Suffolk – deceived hundreds of unsuspecting investors, most of whom were at or near retirement age, by convincing them to invest in or send money to companies owned and controlled by Alcorn, Bank, and Maerki. Alcorn and others then misappropriated significant portions of the investment funds to pay for their criminal enterprise and lavish lifestyles, as well as to pay exorbitant commissions to Smith and other salesmen.
Smith began selling these fraudulent investments in 2011 for Alcorn, Maerki, and Bank. The conspirators used material misrepresentations to sell illiquid, highly speculative investment vehicles that were then used as vehicles for fraud. Based on these fraudulent misrepresentations, unsuspecting investors cashed out of 401(k) and other retirement accounts to invest without knowing that Alcorn, Bank, and Maerki were immediately transferring 20%–70% of the funds to other companies that they controlled in the form of purported “fees.” As a result of this investment fraud scheme, the victims suffered losses in excess of $20 million.
Alcorn was convicted of conspiracy, wire fraud, and money laundering. He faces a maximum penalty of over 200 years in prison when sentenced on June 23. Smith was convicted of conspiracy and wire fraud, and he faces a maximum penalty of over 90 years in prison when sentenced on June 23. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
Bank was convicted after trial of conspiracy, mail and wire fraud, selling unregistered securities, securities fraud, and money laundering, and was sentenced in September 2021 to 35 years in prison. Maerki pleaded guilty to conspiracy and was sentenced in March 2021 to 16 years in prison. Seabolt was convicted after trial of conspiracy and mail fraud and sentenced in September 2021 to 10 years in prison. Gibson pleaded guilty to conspiracy and was sentenced in February 2020 to 10 years in prison. Hudspeth pleaded guilty to investment advisor fraud and money laundering and was sentenced in May 2018 to over 12 years in prison. Sellers pleaded guilty to conspiracy and was sentenced in January 2022 to 5 years in prison. Coffin and Barnett each pleaded guilty to conspiracy and will be sentenced in March and May 2022, respectively.
Jessica D. Aber, U.S. Attorney for the Eastern District of Virginia; Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office; Darrell J. Waldon, Special Agent in Charge of the Criminal Investigations Unit of the Internal Revenue Service; and Greg L. Torbenson, Acting Inspector in Charge of the U.S. Postal Inspection Service’s Washington Division, made the announcement after Senior U.S. District Judge Raymond A. Jackson accepted the verdict.
The Virginia State Corporation Commission provided significant assistance with this investigation.
Assistant U.S. Attorneys Melissa O’Boyle, Elizabeth Yusi and Andrew Bosse are prosecuting the case.
Combatting elder abuse and financial fraud targeted at seniors is a key priority of the Department of Justice. Elder abuse is an intentional or negligent act by any person that causes harm or a serious risk of harm to an older adult. It is a term used to describe five subtypes of elder abuse: physical abuse, financial fraud, scams and exploitation, caregiver neglect and abandonment, psychological abuse, and sexual abuse. Elder abuse is a serious crime against some of our nation’s most vulnerable citizens, affecting at least 10 percent of older Americans every year. Together with our federal, state, local, and tribal partners, the Department of Justice is steadfastly committed to combatting all forms of elder abuse and financial exploitation through enforcement actions, training and resources, research, victim services, and public awareness. This holistic and robust response demonstrates the Department’s unwavering dedication to fighting for justice for older Americans.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia.
T.18 USC 1349, 1341, 1343 - Conspiracy to Commit Mail and Wire Fraud \ T.18 USC 982(a)(1); T.18 USC 981(a)(1)(C), as incorporated by T.28 USC 2461(c); and T.21 USC 853(p) - Criminal Forfeiture
(2)
T.18 USC 1343 and 2 - Wire Fraud
(7-17)
T.18 USC 1957 - Unlawful Monetary Transactions
(19)
Outcome: 2/23/2022 419 JURY TRIAL (day #14) before District Judge Raymond A. Jackson as to David Alcorn and Aghee William Smith, II held on 2/23/2022. Court, counsel and jurors appeared pursuant to adjournment last evening. Outside of the presence of the jury, for reasons stated on the record Court DENIED previously deferred Motion for Judgement of Acquittal by defendant David Alcorn. Jury received Courts charge and instructions; alternate jurors excused. Remaining (12) jurors retired with instructions to begin their deliberations at 11:50am. Outside of the presence of the jury, Court and counsel answered questions of the jury. Jury later returned with a verdict - Verdict read into the record - Jury Verdict filed in open court. Court excused jurors from service. Sentencing Procedure Order executed and filed in open court as to each defendant. Defendants provided a copy. Sentencing for David Alcorn scheduled for June 23, 2022 at 2:30pm.Sentencing for Aghee William Smith, II scheduled for June 23, 2022 at 11:00am.Deft David Alcorn Motion to Remain on Bond Pending Sentencing - Argued - Court DENIED the Motion for reasons stated on the record and remanded Deft Alcorn to the custody of the USMS. Deft Aghee William Smith, II Motion to Remain on Bond Pending Sentencing - Argued - Court DENIED the Motion for reasons stated on the record and remanded Deft Smith to the custody of the USMS. Court adjourned. (Attachments: # 1 Witness List, # 2 Govt Exh List, # 3 Alcorn Exh List, # 4 Smith Exh List)(Court Reporter Carol Naughton, OCR.) (ptom, )(Court Hours: 10:00 - 4:40) (Lunch: 12:45 - 2:15) (Entered: 02/24/2022)
02/23/2022 420 JURY VERDICT as to David Alcorn (2) Guilty on Count 2,7-17,19. (ptom, ) (Entered: 02/24/2022)
02/23/2022 424 Sentencing Procedures Order as to David Alcorn. Signed by District Judge Raymond A. Jackson & filed in open court on 2/23/22. (ptom, ) (Entered: 02/24/2022)
02/23/2022 Set Hearings as to David Alcorn: Sentencing set for 6/23/2022 at 02:30 PM in Norfolk Courtroom 4 before District Judge Raymond A. Jackson. (ptom, ) (Entered: 02/24/2022)
Plaintiff's Experts:
Defendant's Experts:
Comments: