Ponzi Scheme: James Risher accused of bilking millions from Polk County investors
4:17 PM, Jun 7, 2011
Written by Fort Myers News-Press
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Lakeland, Florida -- If it had all gone according to James Risher's plan, he'd be relaxing on a beach somewhere in Bermuda by now.
Instead, the Sanibel resident is in federal custody, accused of bilking $16 million from more than 100 investors in a Ponzi scheme spanning the past four years.
Risher caught wind he was being investigated by the FBI, U.S. Postal Inspection Service, the IRS and the State Office of Financial Regulation.
He was preparing to board a flight May 31 to Bermuda when he was arrested.
He is charged with conspiracy to commit mail and wire fraud, committing mail and wire fraud and money laundering.
"He had everyone believing he was a legitimate business manager," said Robert Rex, a Boca Raton attorney representing dozens of victims - 65 in Lakeland, one in Lee, one in Charlotte, five in California, two in Colorado and one each in Texas, Utah, Kentucky, Arkansas, Hawaii and Ontario, Canada.
Most of the victims, Rex said, are between ages 65 and 90, with most investments ranging from $50,000 to $250,000.
"These are retired teachers, Publix employees, policemen, firemen - hardworking people, and they've lost everything," Rex said. "They were depending on that quarterly distribution for mortgages, groceries, health expenses ... this has been devastating."
Linda Walker, inspector with the U.S. Postal Inspection Service, detailed Risher's scheme in her 13-page complaint, filed in the U.S. District Court's Tampa Division.
Most of the victims are in Lakeland, with many attending the same church, and are acquaintances of Lakeland resident Daniel Sebastian.
Risher met Sebastian sometime around the spring of 2006, and by the following year, the pair planned to solicit investment funds through three companies they managed. Sebastian marketed investment opportunities to potential clients, and Risher was to conduct trades using those funds.
But of the $20 million the pair collected, only about $4 million got invested or distributed. The remaining $16 million was spent solely for the personal enrichment of Sebastian and Risher, according to Walker.
The complaint reveals the pair spent millions on multiple homes - Risher had properties in Fort Myers, Sanibel and North Carolina. There was also million-dollar home remodeling projects, cars, artwork and more. Photos show Risher and his wife, Valerie, raising a champagne toast at a 2007 charity event for lupus research.
Investigators uncovered more than 24 bank accounts in Risher's name, one of those in Bermuda.
Sebastian, although named in Walker's complaint, has not been charged.
Risher. meanwhile, has a history of economic crimes.
In 1990, he pleaded guilty to multiple counts of theft by taking, as well as multiple counts of violating Georgia's securities act. He was sentenced to prison, though the complaint doesn't detail for how long.
Then in 1997, Risher was arrested on one count each of mail fraud and securities fraud and two counts of money laundering in the U.S. Middle District federal court in Fort Myers. According to Rex's records, Risher even convinced one investor to wire him $50,000 for a "new hot deal," which he then later used for bail.
Risher ultimately pleaded guilty and was sentenced to seven years in prison, plus three years of supervised release, and was ordered to pay almost $700,000 in restitution.
He also faced charges in 1989 and 1990 in California for racketeering and fraud or truth-in-lending, and in a separate 1996 Lee County Ponzi scheme, but all those charges were later dropped. It's not clear why from records.
Given Risher's history, Rex said the banks, too, had a responsibility to realize who they were dealing with, and the attorney said he anticipates future civil lawsuits centered around that aspect of the case.
Rachel Revehl, Fort Myers News-Press
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