Arizona man pleads guilty in Ponzi scheme
By Nicholas Charalambous
Independent-Mail
2/9/00
An Arizona man has pleaded guilty to conspiracy for his part in a Seneca-based Ponzi scheme that prosecutors now say bilked investors out of $57 million - $11 million more than originally thought.
Meanwhile, an Amarillo, Texas, insurance agent and his wife who sold investments in the scheme were found dead in their home Jan. 31 in an apparent murder-suicide, said Lt. E.W. Smith of the Amarillo-area Special Crimes Unit.
No suicide note was found, but Mayo McGee's financial dealings recently came under scrutiny by several federal agencies, he said.
Alvin A. Tang, 40, of Scottsdale, Ariz., pleaded guilty in federal court in Anderson. He was president of United States Guarantee Corp., a "shell" company prosecutors said was used to give an air of legitimacy to the scheme.
Federal Judge G. Ross Anderson delayed sentencing until a pre-sentencing report can be completed. Tang faces up to five years in prison and a $250,000 fine.
Tang became the second to plead guilty in connection with the scheme, which authorities said ensnared more than 1,200 people across the United States.
Investigators have accused Virgil Womack, 59, of Seneca of masterminding the scheme to sell high-yield guaranteed contracts in U.S. Government securities and property under the names Alliance Trust, Chemical Trust and Merritt-Pierce Trust.
Prosecutors have said money from new investors was used to pay a small "return" to old investors without any investment being made.
Mr. Womack, along with his wife, Charlotte, 51, also of Seneca, and her brother Clifton Wilkinson, 43, of Toccoa, Ga., are charged with conspiracy, wire fraud, mail fraud and money laundering. Mr. Wilkinson was administrator of Stephens County, Ga., for three years before leaving in November to pursue private consulting.
Mr. Wilkinson's wife, Crystal Wilkinson, 36, also of Toccoa, pleaded guilty to conspiracy in January. She is awaiting sentencing.
Part of the scheme's allure was that United States Guarantee issued bogus bonds purporting to ensure investors' money, Assistant U.S. Attorney David Stephens told the court. Tang received a 7 percent cut of the proceeds.
Beattie Ashmore, appointed by the court to seize assets from the scheme, said Tuesday that $25 million had been recovered so far from domestic and offshore bank accounts.
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