Nine more firms may be involved in Ponzi scheme
By Nicholas Charalambous
Independent-Mail
2/15/00
An investigation into a Seneca-based Ponzi scheme that prosecutors say bilked investors of $52 million was expanded Monday to include another nine companies that may also have sold bogus investments.
In a hearing in federal court in Anderson, investigators obtained a court order to examine the financial records of the newly discovered trusts, which they said had been next in line to sell bonds before the operation was shut down in January.
Virgil Womack, 59, of Seneca is accused of masterminding the scheme to sell high-yield U.S. government securities and property to at least 1,275 investors across the United States under the names Alliance Trust, Chemical Trust and Merritt-Pierce Trust. Prosecutors say money from new investors was used to pay a small "return" to old investors without any investment being made.
Greenville attorney Beattie Ashmore, who was appointed by the court to seize assets associated with the scheme, said Mr. Womack now also is linked to Cardinal Trust, Carver Trust, Continental Trust, Hampton Trust, Heart-Land Trust, Hersheys Trust, Three Rivers Trust and United Marketing Trust.
Mr. Ashmore said $10,000 in bonds were sold through one of the new trusts, but further investigation may turn up more.
About $25 million of the $52 million has been recovered so far from domestic and offshore bank accounts, he said.
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 former Stephens County, Ga., administrator.
Mr. Wilkinson's wife, Crystal Wilkinson, 36, also of Toccoa, pleaded guilty to conspiracy in January and is awaiting sentencing. Alvin A. Tang of Scottsdale, Ariz., pleaded guilty to conspiracy last Monday for setting up a shell corporation to guarantee the investments. He also is waiting to be sentenced.
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Grand jury indicts 3 in connection with scheme
By Nicholas Charalambous
Independent-Mail
2/23/00
GREENVILLE - A federal grand jury Thursday indicted a former Stephens County, Ga., administrator and two others in connection with an Upstate-based Ponzi scheme that prosecutors say bilked $52 million from investors across the nation.
Virgil Womack, 59, and his wife, Charlotte, 51, both of Seneca, and Clifton Wilkinson, 43, of Toccoa, Ga., were indicted in federal court in Greenville on charges of conspiracy, wire fraud, mail fraud and money laundering, said a federal official close to the case who did not wish to be identified.
Mr. Wilkinson spent three years as Stephens County administrator before resigning in November to pursue private consulting.
An indictment means the grand jury believes enough evidence exists to take the case to trial. Federal grand jury proceedings occur in secret.
The defendants are accused of operating a scheme to sell bogus high-yield government securities to at least 1,275 investors across the United States. Prosecutors have said money from new investors was used to pay a small "return" to old investors without any investment being made.
Two others already have pleaded guilty to conspiracy for their part in the scheme and are awaiting sentencing.
Mr. Wilkinson's wife, Crystal Wilkinson, 36, also of Toccoa, faces five years in prison for cutting commission and investor checks among other secretarial tasks.
Alvin A. Tang, 40, of Scottsdale, Ariz., also faces five years in prison for his role as president of United States Guarantee Corp., a "shell" company used to give the scheme the appearance of legitimacy.
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3 plead innocent in Ponzi scheme
By Andrew Moulton
Independent-Mail
3/11/00
GREENVILLE - Two Seneca residents and a former top official in Stephens County, Ga., pleaded innocent in federal court in Greenville to charges that they bilked investors of $57 million nationwide.
U.S. attorney's office spokeswoman Mary Gordon Baker said Virgil Womack, 59, and his wife Charlotte, 51, both of Seneca, and Clifton Wilkinson, 43, of Toccoa, Ga., entered the pleas Thursday. No trial date has been set.
In February a federal grand jury indicted all three on charges of conspiracy, wire fraud, mail fraud and money laundering. The charges relate to a Ponzi scheme to sell bogus high-yield government securities to at least 1,275 investors across the country. Money from new investors was used to pay small "returns" to old investors with no investment being made, according to prosecutors.
Two other people await sentencing after pleading guilty to related charges. Mr. Wilkinson's wife, Crystal, 36, faces five years in prison for cutting commission and investor checks among other secretarial tasks. Alvin A. Tang, 40, of Arizona also faces five years in prison for his role as president of a "shell" company used to give the scheme the appearance of legitimacy.
Mr. Wilkinson resigned as Stephens County administrator in November of last year.
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Lawyer guilty in Ponzi scheme
By Amy Hebert
Independent-Mail
3/18/00
A Georgia attorney became the third person to admit a role in a multimillion-dollar Ponzi scheme based out of Seneca when he pleaded guilty in an Anderson federal court Friday to charges of transmitting fraudulent money.
Clarence Nelson Jarnagin, 51, of Brunswick, Ga., told the court that he handled about $1.5 million worth of stolen money and traveled to the Bahamas to set up a bank account there while working for Virgil Womack of Seneca.
He said Mr. Womack had consulted with him last March about setting up a tax-exempt investment business through a "loophole" in Georgia law. He said Mr. Womack paid him fees for legal advice and for transferring checks from Seneca to Saint Simons Island, Ga., then to the Bahamas.
He said Mr. Womack and former Stephens County, Ga., administrator Clifton Wilkinson were responsible for obtaining and managing the investment money as the business grew and attracted people from several states.
"The activity virtually exploded. There were several millions of dollars," Jarnagin told the court. "More and more money came in and came in."
Mr. Womack, 59, his wife, Charlotte, 51, and Mr. Wilkinson, 43, of Toccoa, Ga., all pleaded innocent earlier this month to charges of conspiracy, wire fraud, mail fraud and money laundering.
They are accused of taking $56 million from more than 1,000 investors across the country by selling them bogus securities and using money from new investors to pay a small "return" to old investors without investing any money.
Mr. Wilkinson spent three years as administrator with Stephens County before resigning last November to pursue private consulting.
His wife, Crystal, the 36-year-old sister of Mr. Womack, pleaded guilty to conspiracy in January for performing secretarial tasks for the company. She is awaiting sentencing and faces a maximum of five years in prison.
An Arizona man also has pleaded guilty to conspiracy and faces five years in prison for operating a "shell" company used to give the scheme an air of legitimacy.
About $25 million has been recovered from several domestic and offshore accounts, including about $500,000 from Jarnagin's personal account in Georgia.
Jarnagin, who had not been officially charged before Friday, is awaiting sentencing and faces a maximum of 10 years in prison. He agreed to continue cooperating with prosecutors throughout the investigation and, having made bond, left the courtroom on his own recognizance.
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