Kentucky Lawyer Convicted in Oil and Gas Lease Ponzi Scheme

Kentucky.com reported at the end of last week on the Oil and Gas Lease Ponzi scheme convictions of among others, Lexingotn attorney, Byron Coffman.  Coffman was a former republican candidate for Congress. This is an excerpt from the Kentucky.com report:

"Lexington lawyer Bryan S. Coffman, 47, was found guilty of eight counts of mail fraud, nine counts of wire fraud, two counts of securities fraud, 10 counts of money laundering and one money laundering conspiracy count. He was acquitted on two money laundering charges, according to the U.S. attorney's office. [ . . . ]
Coffman's wife, Megan Coffman, 48, who was facing money laundering charges, was acquitted on all of the charges.

Bryan Coffman and Milby face up to 20 years in prison. U.S. District Judge Karen Caldwell is scheduled to sentence them Aug. 24.  A fourth defendant, Vadim 'Victor' Tsatskin of Canada, testified for the prosecution and was promised he would not be prosecuted in exchange for his testimony.

Authorities said about 500 corporate and individual investors in several states and countries were promised big returns from wells in Green and Adair counties that were actually dry holes or wells that didn't produce as long as promised. The defendants intentionally misrepresented and omitted facts about their oil and gas drilling programs, prosecutors maintained. The defendants gave investors false information about the use of investor money, investor risk, successes of their previous drilling programs and their companies' compliance with federal laws, according to the prosecution.

The oil and gas production investment scheme, which used the company names Mid-America Energy Inc. and Global Energy Group, began in 2004 and lasted through 2008, according to prosecutors.   The defendants were accused of fraudulently using investors' money for things such as jewelry, real estate, a lavish birthday party, a yacht and retirement accounts."
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Ponzi scheme defendants populated FCI, Morgantown's White Collar Criminal Elite.  In my residential unit the guy who ran gambling was an OurTown Ponze schemer.  When not running the "floating poker" game, he occupied his time watching the CNBC stock ticker--apparently the feds did not seize all of his assets. 

A friend who works in the law office, here, in OurTown lost her life savings to a real estate Ponzi scheme run by a crook she met through her church.  The investment scam  purported to build houses near Phoenix, Az.  While it's not the purpose of this post to analyze that scheme it's not lost on me that the chaos in Maricopa County created a vacuum that contributed to or enabled the scheme that cost my friend and her family their retirement. 

Ponzi Schemer, Former Lawyer Scott Rothstein With Good Friends

Bad Lawyer previously blawged about former lawyer and convicted Ponzi schemer Scott Rosthstein; here's a look at some of his "good friends."

How to Crush Ego, First Get Rid of the Hair Piece!

Andrew Stein (pic with the obvious toupee`) is a legendary NYC mook, a former Councilman and tax cheat.  Stein has lived a charmed life which may be coming to an end as he's been swept up in the Ponzi scheme run by celebrity investment adviser Ken Starr (no not that . . . Kenneth Starr.)

The NY Daily News story by Michael Daly is a matchless study in the wages of ego and further proof, that every road is a toll road. According to Mr. Daly, in the 1970s Stein was at a Hampton Beach with an heiress who in the surf was caught in an undertow and screaming for assistance from Stein who stood helplessely pointing at the hair piece.  The preening Mr. Stein would not dive in to help her for fear of losing his toupee`, according to Mr. Daly others dove in to rescue her.  

I had a trial instructor at OurTown's elite law school who was a wonderful teacher and better lawyer.  Gerry had a really obnoxious hair piece that fooled no one.  When I got married, my pals took me to the Schvitz for a sweat and bachelor's party.  There was Gerry sans toupee`--bald as a baby's butt.  Thereafter whenever I see a male lawyer in an obvious wig, I remember Gerry.

Part of what made Gerry so memorable, is that the toupee` did not betray the obvious ego-issues evident in Mr. Stein's "comedy."  The Daily News is having a good time speculating on Mr. Stein's mugshot.  I guarantee you that there's a FOIA request for that picture.  When the Daily News obtain and publish the photo, Mr. Stein will have paid part of the toll.

Killer Cop, Tax Cheat Gets 10 Years!

The Minneapolis Star-Tribune has this jaw-dropping report on a really bad cop, a crooked cop.  Douglas Earl Leiter is going to jail for 10 years after being caught in running an elaborate tax scam that ensnared a number of co-defendants who are also going to prison for some time.  If this were just about tax cheats, it wouldn't be "blawg"-worthy, but Leiter was a real Bad Cop.  Here's the account by Paul Walsh:

"Mark David Maxwell, 54, of Minneapolis, was sentenced Thursday in federal court in St. Paul to five years and nine months in prison on one count of conspiracy to defraud the IRS.

The sentences for the others: the former officer, Douglas Earl Leiter, 42, of Minneapolis, 10 years, one month; Brian Keith Scott, 44, of Zimmerman, six years, six months; Christopher Craig Robinson, 37, of Plymouth, one year, eight months; Timothy Paul McCarthy, 63, of Minneapolis, four years, four months; and Laurie Therese Brausen, 53, of Little Canada, six months.

Leiter was regarded as the lead defendant in the case. He and several others founded a group called Common Law Venue, which the IRS said ran schemes that taught clients how to evade taxes by filing bogus trust tax returns or claiming phony "miscellaneous" deductions or setting up shadow corporations and nonprofit 'clubs.'

In 2003, the IRS moved to collect $10,000 in back taxes and fees from Leiter. A federal grand jury indicted him and several others in August 2008.  In a 1998 high-speed chase, Leiter's squad car struck a pickup truck and killed two people. He was charged with two misdemeanors but not convicted. The victims' families each received a $300,000 settlement from the city.

In 2001, Leiter was suspended for 60 hours in connection with an off-duty search for records regarding co-defendant McCarthy, his one-time housemate and former priest who had been accused of criminal sexual contact with an inmate at the Hennepin County juvenile jail.
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This ex-cop should be out and about by the time he marks his 50th birthday.  Plenty of time for more mayhem.

Years ago I represented a bunch of working stiffs who had were ripped off by a tax preparer.  This was near the end of the day and age when manufacturing jobs abounded.  As this tax preparer went through the financial information of these blue collar guys he would tell them that he could save them money on their taxes based on charitable deductions these guys had not made, then he would tap the top of a file cabinet in his office and would wink at these schmoes and say--"I have all your receipts in here."  Worse, he'd see their 1099s and suggest that they move their saving to his Gold Mine investments.  It sounds ludicrous now, but this tax thief took these guys for hundreds of thousands of dollars. 

After I got involved, it turned out that this guy had been at it for many years and had robbed many of these auto workers of their life savings.  My clients kept asking me how come I couldn't attach "his gold mines."  They were incredulous when I told them that there was not gold mines.  It seems unreal even after all these years that these men fell for this fraud, but there's a lovely intelligent woman in the office where I currently work who fell for a Ponzi-scheme that is just as absurd on its face.  The Ponzi schemer took in $8 million dollars from working class folks working in and around OurTown for investment in "real estate deed trusts" for properties allegedly being built in and around Phoenix, AZ.  These victims were taken in by a member of their church.  Nice.

Lock Me Up, Right Now!

I'm just catching up with this interesting report from the Minnesota Star Tribune from last month.

Andover, Minnesota Ponzi-scheme suspect Gerard Frank Cellette, Jr. (pic) a former printer appeared it the Hennepin County District Court and asked Judge Gary Larson to send him to jail forthwith, without the nicety of guilty plea, trial or conviction.

Having spent the better part of two years expecting and dreading professional disaster, I get where Mr. Cellette is coming from, let's get to it!

Note: to self, we will talk about Ponzi schemes, there's a Bad Lawyer out of Florida that needs our attention.